Decrease in government spending will cause

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Reference no: EM13819098

On the Keynesian cross diagram, a decrease in government spending (as in tight (contractionary) fiscal policy) will cause

A. the "PE = Y" curve to shift downward

B. the AD curve to shift to the left

C. an unplanned inventory drop

D. higher equilibrium income

E. none of the above

Reference no: EM13819098

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