Figure 16-1

-Refer to Figure 16-1.Consider point A where inflation is relatively high and unemployment
Is relatively low.In order to move down the curve toward point B, what fiscal policy measures should the policymakers undertake?

Question

Figure 16-1
 
-Refer to Figure 16-1.Consider point A where inflation is relatively high and unemployment
Is relatively low.In order to move down the curve toward point B, what fiscal policy measures should the policymakers undertake?

Quizplus · Accepted Answer

To move down the curve from point A to point B, policymakers should aim to reduce inflation and increase unemployment. Increasing taxes and decreasing government spending would reduce aggregate demand, helping to lower inflation and potentially increase unemployment.

Figure 16-1 -Refer to Figure 16-1.Consider Point a Where Inflation Is Relatively