Solved

Use the Following Diagram to Answer the Following Questions

Question 82

Multiple Choice

Use the following diagram to answer the following questions.
Use the following diagram to answer the following questions.    -Refer to Diagram 13-1. Suppose the economy is currently in equilibrium at point A. If government increases spending, this would most likely: A)  shift aggregate demand from AD₁ to AD₂. B)  shift aggregate demand from AD₁ to AD<sub>3</sub>. C)  cause unemployment. D)  cause the equilibrium level of real GDP and the equilibrium price level to fall.
-Refer to Diagram 13-1. Suppose the economy is currently in equilibrium at point A. If government increases spending, this would most likely:


A) shift aggregate demand from AD₁ to AD₂.
B) shift aggregate demand from AD₁ to AD3.
C) cause unemployment.
D) cause the equilibrium level of real GDP and the equilibrium price level to fall.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Unlock this Answer For Free Now!

View this answer and more for free by performing one of the following actions

qr-code

Scan the QR code to install the App and get 2 free unlocks

upload documents

Unlock quizzes for free by uploading documents