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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A stock mutual fund is generally
A) less risky than buying individual stocks. B) more risky than buying individual stocks. C) just as risky as buying individual stocks. D) a way for the rich to avoid taxes.
Which of the following would NOT be official reserves for Germany?
A) U.S. dollars B) the official currency of Germany C) gold D) SDRs
Inflation targeting does all of the following except:
A. communicate policymakers' objectives clearly and openly. B. increase policymakers' accountability. C. increase policymakers' credibility. D. hinder economic growth.
Between 1929 and 1933, NNP measured in current prices fell from $96 billion to $48 billion. Over the same period, the relevant price index fell from 100 to 75
a. What was the percentage decline in nominal NNP from 1929 to1933? b. What was the percentage decline in real NNP from 1929 to 1933? Show your work.