Exhibit 14-8 Aggregate Demand and Supply

Multiple Choice

Exhibit 14-8 Aggregate demand and supply

-In Exhibit 14-8,if aggregate demand shifts from AD₃ to AD₂,real GDP will:

A) fall from $7.0 to $4.0, and the price level will not change.
B) not change, and the price level will fall from 120 to 100.
C) fall from $7.0 to $3.0, and the price level will fall from 120 to 100.
D) fall from $8.0 to $4.0, and the price level will fall from 120 to 100.
E) fall from $7.0 to $4.0, and the price level will fall from 120 to 100.