Question: 12. Problem 12 The graph below is associated with a hypothetical country. Consider an increase in aggregate demand (AD). Specifically, aggregate demand shifts to the


12. Problem 12 The graph below is associated with a hypothetical country. Consider an increase in aggregate demand (AD). Specifically, aggregate demand shifts to the right from AD, to A Do, causing the quantity of output demanded to rise at each price level. For instance, at a price level of 140, output is now $400 billion, where initially it was $300 billion. (? 170 160 150 140 130 PRICE LEVEL 120 AD 2 10 AD. 100 100 200 300 400 500 800 700 800 OUTPUT (Billions of dollars) The following table lists several determinants of aggregate demand. Fill in the missing values in the table by selecting the change in each scenario required to increase aggregate demand. Change Required to Increase AD Interest rates Increase Domestic currency value relative to the foreign currency Depreciate Wealth Increase Increase Taxes
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