Q10 · Practice questionSimple familiar1 mark
QUESTION 10
The diagram shows a change from E1 to E2. Which event could generate the change, ceteris paribus?
(A)
An increase in planned business investment.
(B)
A rise in imported energy costs.
(C)
A fall in consumer confidence.
(D)
An improvement in production technology.
WORKED SOLUTION
1 markAnswer A
Answer
A
Working
The AD curve shifts right while SRAS is unchanged. Stronger investment raises demand and increases both equilibrium output and the price level in this model.
Marking criteria
- Select A. [1 mark]
Practice question aligned to the current QCAA syllabus; review the worked solution and marking criteria.
View the QCAA syllabus