Refer to the information provided in Figure 27.4 below to answer the question(s) that follow.
Figure 27.4Refer to Figure 27.4. If the economy is currently at the intersection of AS and AD, a decrease in AS with no change in AD will cause
A. economic growth.
B. deflationary growth.
C. stagflation.
D. deflation.
Answer: C
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If the government eliminated unemployment benefit payments what would be the effect on the level of real GDP and well being in the economy?
The government agency that provides insurance for all checkable deposits up to $100,000 in banks choosing its protection is the:
a. Federal Deposit Insurance Corporation. b. Federal Reserve. c. Office of Management and Budget. d. Treasury. e. Securities and Exchange Commission.
Why does the government index income tax rates to inflation?
a. To avoid people paying less in taxes when there is inflation b. To avoid people moving to a higher tax bracket when their purchasing power has increased c. To avoid people paying less in taxes when their real purchasing power has not increased d. To avoid people paying more in taxes when their real purchasing power has not increased
Open-market purchases by the Fed
a. make the price level and value of money fall. b. make the price level rise, and make the value of money fall. c. make the price level and make the value of money rise. d. make the price level fall, and make the value of money rise.