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Question 181

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Use the following to answer questions: Use the following to answer questions: -(Figure: AD-AS) Refer to Figure: AD-AS.Assume that the economy is in long-run equilibrium.If the Bank of Canada lowers the key interest rate: A) the aggregate demand curve will shift to AD<sub>2</sub>. B) the aggregate demand curve will stay unchanged at AD<sub>1</sub>. C) there will be a downward movement along the aggregate demand curve AD<sub>1</sub>. D) the aggregate demand curve will shift to AD<sub>3</sub>.
-(Figure: AD-AS) Refer to Figure: AD-AS.Assume that the economy is in long-run equilibrium.If the Bank of Canada lowers the key interest rate:


A) the aggregate demand curve will shift to AD2.
B) the aggregate demand curve will stay unchanged at AD1.
C) there will be a downward movement along the aggregate demand curve AD1.
D) the aggregate demand curve will shift to AD3.

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