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Economics
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Economics
Suppose the government increases its purchases by Rs16 billion. If the multiplier effect exceeds the crowding out effect, then ?
A
The aggregate supply curve shifts to the right by more than Rs 16 billion
Option A
B
The aggregate demand curve shifts to the left by more than Rs 16 billion
Option B
The aggregate demand curve shifts to the right by more than Rs 16 billion
Correct answer
D
the aggregate supply curve shifts to the left by more than Rs 16 billion
Option D
Correct answer: C
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