Answer the next six questions on the basis of the following diagram.

-To counter inflation, policymakers might reduce aggregate demand from AD₅ to AD₄ by:

Question

Answer the next six questions on the basis of the following diagram. -To counter inflation, policymakers might reduce aggregate demand from AD₅ to AD₄ by:

Quizplus · Accepted Answer

All the options listed are methods to reduce aggregate demand, which can help counter inflation. Incomes policies can limit wage increases, tax increases can reduce disposable income, and reductions in government spending can decrease overall demand in the economy.

Answer the Next Six Questions on the Basis of the Following