Refer to the graph shown. Expansionary fiscal policy is most likely to shift the aggregate demand curve from:
A. AD0 to AD2 if crowding out does not occur and from AD0 to AD3 if crowding out does occur.
B. AD2 to AD0 if crowding out does not occur and from AD1 to AD3 if crowding out does occur.
C. AD0 to AD2 if crowding out does not occur and from AD0 to AD1 if crowding out does occur.
D. AD2 to AD0 if crowding out does not occur and from AD1 to AD2 if crowding out does occur.
Answer: C
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