A tradeoff is illustrated by
A) a point inside the PPF.
B) a point outside the PPF.
C) a change in the slope of the PPF.
D) the negative slope of the PPF.
Question 2
There are several reasons why the aggregate demand curve is downward sloping. Which of the following CORRECTLY describes one of these explanations?
A) A rise in the price level raises the purchasing power wealth and increases desired consumption.
B) A rise in the price level raises interest rates and increases investment spending.
C) A fall in the price level, holding foreign prices and the exchange rate constant, increases net exports.
D) A rise in the price level lowers the interest rate and increases investment spending.
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