Exhibit 20-5  Money, Investment and Product Markets in Exhibit 20-5

Multiple Choice

Exhibit 20-5  Money, Investment and product markets In Exhibit 20-5, a shift in aggregate demand from AD₂ to AD₃:

A) increases real GDP, and lowers the price level.
B) decreases real GDP, and lowers the price level.
C) increases real GDP, and raises the price level.
D) decreases real GDP, and raises the price level.
E) has no effect on real GDP and the price level because the economy can never reach full employment.