Solved

-In Figure 11

Question 80

Multiple Choice

-In Figure 11.1,assume that Q<sub>F</sub> is full-employment output and the level of aggregate spending is represented by AD<sub>1</sub>.If AD<sub>1</sub> increases to AD<sub>2</sub>,which of the following statements is correct? A) Full employment will be reached. B) Excess AD and inflation will be the result. C) Full employment will not be reached because some of the additional spending results in higher prices rather than higher output. D) A lower price level will result.
-In Figure 11.1,assume that QF is full-employment output and the level of aggregate spending is represented by AD1.If AD1 increases to AD2,which of the following statements is correct?


A) Full employment will be reached.
B) Excess AD and inflation will be the result.
C) Full employment will not be reached because some of the additional spending results in higher prices rather than higher output.
D) A lower price level will result.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Q75: Using Figure 11.1,which</p></div><svg width=

Q76: -Refer to</p></div><svg width=

Q77: Joan Robinson,author of The Second Crisis of

Q78: Fiscal policy affects
A)The level of output only.
B)The

Q79: Which of the two fiscal stimulus tools

Q82: Disposal income refers to
A)Personal income before personal

Q103: Defense,health,and highway spending are income transfers.

Q106: An example of fiscal policy occurs when

Q111: The Sixteenth Amendment to the Constitution in

Q119: Fiscal policy involves changes in government spending

Unlock this Answer For Free Now!

View this answer and more for free by performing one of the following actions

qr-code

Scan the QR code to install the App and get 2 free unlocks

upload documents

Unlock quizzes for free by uploading documents