-If war breaks out and the economy is at full employment,we would move from
A)W to X.
B)X to W.
C)X to Y.
D)Y to X.

Question

-If war breaks out and the economy is at full employment,we would move from
A)W to X. 
B)X to W. 
C)X to Y. 
D)Y to X.

Quizplus · Accepted Answer

In a situation where the economy is at full employment and war breaks out, the demand for goods, services, and labor typically increases to support the war effort. This increased demand can push the economy beyond its full employment level, moving it from point X (full employment) to point Y (an overheated economy or beyond full employment), indicating an increase in economic activity and potentially leading to inflationary pressures.

-If War Breaks Out and the Economy Is at Full