The graph shown displays various price and output levels in an economy. Which point on the graph shown would represent an economic expansion? A) E ₁ B) E ₂ C) E ₃ D) E ₄

Question

Quizplus · Accepted Answer

Economic expansion is characterized by an increase in both output and prices. Point D on the graph shows an increase in both output (from Point E to Point _{4) and prices (from Point E to Point}), making it the best representation of an economic expansion.

The Graph Shown Displays Various Price and Output Levels in an Economy