Refer to the information provided in Figure 28.7 below to answer the question(s) that follow.
Figure 28.7Refer to Figure 28.7. Suppose the economy is at Point A and the cost of inputs is fixed. A decrease in government spending could move the economy to Point
A. E.
B. B.
C. C.
D. D.
Answer: B
You might also like to view...
Based on the figure below. Starting from long-run equilibrium at point C, a decrease in government spending that decreases aggregate demand from AD1 to AD will lead to a short-run equilibrium at__ creating _____gap.
A. B; no output B. D; an expansionary C. B; recessionary D. D; a recessionary
The prediction by the American Medical Association of a shortage of physicians by the year 2020 assumes
A) physicians' fees will not rise to a market clearing level. B) physicians' services will be free goods. C) physicians' services will no longer be scarce. D) physicians will be willing to work for less income.
Leverage is essential to a bank's profitability but it also increases risk
a. True b. False Indicate whether the statement is true or false
Economic activity moves from a trough into a period of ________ until it reaches a ________ and then into a period of ________.
A. recession; peak; expansion B. recession; trough; expansion C. expansion; trough; recession. D. expansion; peak; recession