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What will be the effect on aggregate demand

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Reference no: EM132181656

Question: 1. What will be the effect on aggregate demand of each of the following?

(a) A strike in the docks which prevents the loading and unloading of exports and imports.

(b) Technological advances which improve the productivity of capital.

(c) A decrease in the expected rate of inflation.

(d) A budget deficit.

2. How would the slope of the aggregate demand curve in an economy differ if the real balance effect was (i) relatively strong; (ii) relatively weak?

Reference no: EM132181656

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