-Refer to the above diagrams, in which the numbers in parentheses near the AD₁, AD₂, and AD₃ labels indicate the levels of investment spending associated with each curve. All figures are in billions. What is the desired level of investment spending in this economy if it is to achieve a noninflationary full-employment level of real GDP (Q_f) _?

Question

-Refer to the above diagrams, in which the numbers in parentheses near the AD<sub>1</sub>, AD<sub>2</sub>, and AD<sub>3</sub> labels indicate the levels of investment spending associated with each curve. All figures are in billions. What is the desired level of investment spending in this economy if it is to achieve a noninflationary full-employment level of real GDP (Q<sub>f</sub>) <sub>?</sub> A) $50. B) $100. C) $150. D) $225.

Quizplus · Accepted Answer

The desired level of investment spending is $100 billion, as indicated by the AD curve that intersects the long-run aggregate supply curve at the full-employment level of real GDP (Q_f).

-Refer to the Above Diagrams, in Which the Numbers in Parentheses