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
Answer: D
You might also like to view...
The above figure shows the market for DVDs. The government decides that all citizens deserve to watch affordable DVDs so a price ceiling of $12 per DVD is placed on DVDs
After this price ceiling is in effect and taking account of the resources lost in search, consumer surplus equals ________. A) $900,000 B) $400,000 C) $200,000 D) $180,000 E) $100,000
Income mobility is:
A. how much income is stored in offshore banks. B. the ability to improve one's economic circumstances over time. C. how likely the income associated with each job in the country will change in relative terms. D. how likely the income associated with each job in the country will increase over time.
In which of the following periods did fiscal spending on national defense as a percentage of GDP increase?
a. In the 1990s, after the dotcom bubble burst b. After World War I c. In 2007, during the Great Recession d. In the 1980s, near the end of the Cold War
Which of the following is NOT a communication pattern?
a. chain b. circle c. wheel d. arc