Figure 27-1
-Refer to Figure 27-1.Suppose the economy is in a recession and expansionary fiscal policy is pursued.Using the static AD-AS model in the figure above,this would be depicted as a movement from
A)A to B.
B)B to C.
C)C to B.
D)B to A.
E)A to E.

Question

Figure 27-1 
-Refer to Figure 27-1.Suppose the economy is in a recession and expansionary fiscal policy is pursued.Using the static AD-AS model in the figure above,this would be depicted as a movement from
A)A to B. 
B)B to C. 
C)C to B. 
D)B to A. 
E)A to E.

Quizplus · Accepted Answer

Expansionary fiscal policy shifts the aggregate demand curve to the right, moving the economy from a lower output level (A) to a higher output level (B) in the AD-AS model.

Figure 27-1 -Refer to Figure 27-1.Suppose the Economy Is in a Recession