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A Change in Any Component of Aggregate Demand Creates a Larger

Question 47

Multiple Choice

A change in any component of aggregate demand creates a larger change in overall aggregate demand. This is the ________ effect, and it means , for example, that a ________ in consumption will cause an even larger ________ in AD.


A) multiplier; increase; decrease
B) liquidity; decrease; decrease
C) growth; increase; decrease
D) multiplier; decrease; decrease
E) liquidity; increase; decrease

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