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Home › Bihar Board Class 12 (Arts) › Economics › Determination of Income and Employment › When the MPC falls, what happens to the AD line?

When the MPC falls, what happens to the AD line?

AIt shifts up in parallel
BIt stays unchanged
CIt swings downward
DIt becomes steeper
Answer & Solution
Correct answer: C. It swings downward
A fall in c lowers the slope of the AD line, so it swings downward rather than shifting.
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