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A decline in autonomous consumer expenditure causes the aggregate demand function to
shift down, the equilibrium level of aggregate output to ____, and the IS curve to shift to the
____, everything else held constant.
A) rise; left
B) rise; right
C) fall; left
D) fall; right
Answer: C
Diff: 1 Type: MC Page Ref: 564
Skill: Recall
Objective List: 23.1 Apply the IS-MP framework for the determination of aggregate output and
the interest rate
An increase in autonomous consumer expenditure causes the aggregate demand function to
shift up, the equilibrium level of aggregate output to ____, and the IS curve to shift to the
____, everything else held constant.
A) rise; left
B) rise; right
C) fall; left
D) fall; right
Answer: B
Diff: 1 Type: MC Page Ref: 564
Skill: Recall
Objective List: 23.1 Apply the IS-MP framework for the determination of aggregate output and
the interest rate
An increase in autonomous consumer expenditure causes the equilibrium level of aggregate
output to ____ at any given interest rate and shifts the ____ curve to the ____,
everything else held constant.
A) rise; MP; right
B) rise; IS; right
C) fall; MP; left
D) fall; IS; left
Answer: B
Diff: 2 Type: MC Page Ref: 564
Skill: Recall
Objective List: 23.1 Apply the IS-MP framework for the determination of aggregate output and
the interest rate