The economy pictured in the figure below has a(n) ________ gap with a short-run equilibrium combination of inflation and output indicated by point ________. 
A. recessionary; B
B. recessionary; C
C. recessionary; A
D. expansionary; A
Answer: C
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An optimal decision is one that is selected based on an analysis of
a. explicit costs but not implicit costs. b. implicit costs but not explicit costs. c. both explicit costs and implicit costs. d. neither explicit costs nor implicit costs.
Which of the following is NOT one of the components of aggregate demand?
What will be an ideal response?
Which of the following is likely to be most capital-intensive?
A. Oil refining in the United States. B. Production of clothing in rural China. C. Farming in developing countries. D. None of the choices are correct.
The shape of the aggregate demand curve does NOT tell us anything about how the total dollar value of spending will ultimately be divided between output and prices. For this we need
A. information about the standard of living in the country. B. to know how far from the origin the aggregate demand curve is. C. an aggregate supply curve. D. information that only the Consumers' Price Index can provide.