Refer to the graph shown.If the economy is at point D, which of the following policies is most appropriate to bring the economy to potential? 
A) Cut in government spending
B) Cut in taxes
C) Increase in taxes
D) No change in taxes or government spending
Correct Answer:
Verified
Q108: An increase in aggregate demand:
A)raises potential output.
B)reduces
Q117: Refer to the graph shown.A movement from
Q123: Refer to the graph shown.If the price
Q125: Refer to the graph shown.In the graph,
Q127: At the intersection of the short-run aggregate
Q128: If potential output is less than actual
Q137: An inflationary gap exists when:
A)aggregate demand exceeds
Q138: If actual output exceeds potential output, the
Q139: At points on the short-run aggregate supply
Q140: If actual output exceeds potential output, eventually:
A)input
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