-Consider the above figure. If the aggregate demand fell from AD₁ to AD₂, our nation would be experiencing
A)an inflationary gap.
B)a recessionary gap.
C)overemployment.
D)rising prices.

Name: -Consider the above figure. If the aggregate demand fell from AD₁ to AD₂, our nation would be experiencing A)an inflationary gap. B)a recessionary gap. C)overemployment. D)rising prices.
Brand: Quizplus
Rating: 4.9 (39 reviews)

Question

-Consider the above figure. If the aggregate demand fell from AD₁ to AD₂, our nation would be experiencing
A)an inflationary gap. 
B)a recessionary gap. 
C)overemployment. 
D)rising prices.

Quizplus · Accepted Answer

A recessionary gap occurs when aggregate demand decreases, leading to lower output and higher unemployment.

-Consider the Above Figure