refer to the diagram. rational expectations theory says that a fully anticipated shift in aggregate demand from ad1 to ad2 will multiple choice move the economy from a to a new equilibrium at b. move the economy from a to b to c. shift the as curve to the right. move the economy directly from a to c.

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According to the idea of rational expectations, a fully expected transition in aggregate demand from AD1 to AD2 will take place. Transform the economy from point A to point C Option D is correct

The entire quantity of demand for all completed products and services generated in an economy is measured as aggregate demand. The total amount of money spent on those products and services at a certain price level and period is known as aggregate demand. The total market for all goods and services produced by an economy is identified and expressed as an overall dollar value by aggregate demand. For example, a country's total annual demand for products and services may be $1 billion.

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