Use the graph to answer questions
-**Which of the following fiscal policy options would have greater potential of causing inflation?
A) An expansionary policy shifting aggregate demand from AD1 to AD2
B) A contractionary policy shifting aggregate demand from AD4 to AD3
C) An expansionary policy shifting aggregate demand from AD3 to AD4
D) A contractionary policy shifting aggregate demand from AD2 to AD1
Correct Answer:
Verified
Q23: Federal policy changes that uses automatically changes
Q24: Use the graph to answer questions
Q25: Fiscal policy used to expand aggregate demand
Q26: Contractionary fiscal policy
A)includes cuts in government spending
Q27: Use the graph to answer questions
Q29: A potential tradeoff for reducing pressure on
Q30: When expansionary fiscal policy is used to
Q31: A trade off for contractionary fiscal policy
Q32: _ is used when policymakers actively change
Q33: Fiscal policy used to decrease aggregate demand
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