Refer to the information provided in Figure 26.2 below to answer the question(s) that follow.
Figure 26.2Refer to Figure 26.2. This economy reaches capacity at
A. $300 billion.
B. $600 billion.
C. $900 billion.
D. an output level that is indeterminate from this information because aggregate demand is not given.
Answer: C
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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
Which of the following is a reason behind the rise in US trade over the last 80 years?
A) Rising government expenditure B) Improved bureaucracy C) Improved transportation technology D) Falling consumption expenditure
Discuss the effects of ongoing inflation based on the PPP theory
What will be an ideal response?
A change in net taxes affects the equilibrium quantity of GDP demanded_____
a. in the same way as a change in government purchases does b. in the same way as a change in planned investment does c. in the same way as a change in net exports does d. only indirectly, changing the level of disposable income e. in an unpredictable manner