Question: Explain how the aggregate expenditure function shifts in response to changes in each of the following variables: a.The real interest rate increases. b.Consumer confidence decreases.

Explain how the aggregate expenditure function shifts in response to changes in each of the following variables:

a.The real interest rate increases.

b.Consumer confidence decreases.

c.Higher taxes are imposed on business profits.

d.The economies of many countries in the rest of the world go into recessions.

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