The diagram below shows an AD/AS model for a hypothetical economy.The economy begins in long-run equilibrium at point A. FIGURE 24-3
-Refer to Figure 24-3.A negative shock to the economy shifts the AD curve from to .The initial effect is
A)a recessionary output gap of 100.
B)a recessionary output gap of 300.
C)a recessionary output gap of 550.
D)an inflationary output gap of 200.
E)an inflationary output gap of 100.

Question

The diagram below shows an AD/AS model for a hypothetical economy.The economy begins in long-run equilibrium at point A.  FIGURE 24-3
-Refer to Figure 24-3.A negative shock to the economy shifts the AD curve from  to  .The initial effect is
A)a recessionary output gap of 100. 
B)a recessionary output gap of 300. 
C)a recessionary output gap of 550. 
D)an inflationary output gap of 200. 
E)an inflationary output gap of 100.

Quizplus · Accepted Answer

The Answer of The diagram below shows an AD/AS model for a hypothetical economy.The economy begins in long-run equilibrium at point A.  FIGURE 24-3
-Refer to Figure 24-3.A negative shock to the economy shifts the AD curve from  to  .The initial effect is
A)a recessionary output gap of 100. 
B)a recessionary output gap of 300. 
C)a recessionary output gap of 550. 
D)an inflationary output gap of 200. 
E)an inflationary output gap of 100.

The Diagram Below Shows an AD/AS Model for a Hypothetical