Based on the figure below. Starting from long-run equilibrium at point C, an increase in government spending that increases aggregate demand from AD to AD1 will lead to a short-run equilibrium at point ________ creating _____gap. 
A. D; an expansionary
B. B; no output
C. B; expansionary
D. A; a recessionary
Answer: A
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Which of the following is true of a first-price sealed-bid auction?
A) Bidders directly compete with each other. B) Bidders place their bids simultaneously. C) Bidders know each other's bids. D) Bidders always bid below their willingness to pay.
In economics, the term investment refers to:
a. the cost of employing human capital. b. expenditure on expense accounts of employees. c. firms' expenditure on salaries and rent. d. business spending for acquiring capital goods. e. the expenses on the purchase of stocks of a corporation.
Amy can produce either 5,000 pounds of cheese or 20 cars per year. Mike can produce either 5,000 pounds of cheese or 10 cars per year. If both Amy and Mike produce the good in which they have comparative advantage, the total annual output of this economy will be ________.
A. 10,000 pounds of cheese and 30 cars B. 10,000 pounds of cheese C. 5,000 pounds of cheese and 20 cars D. 30 cars
Which statement is true?
A. Large denomination time deposits are generally CDs of at least $10,000. B. Large denomination time deposits are part of M2, but not M3. C. M1 is part of M2, which, in turn, is part of M3. D. None of the statements are true.