Figure 18-3
-Refer to Figure 18-3.In the dynamic model of AD-AS in the figure above,if the economy is at point A in year 1 and is expected to go to point B in year 2,Congress and the president would most likely

Question

Figure 18-3 
-Refer to Figure 18-3.In the dynamic model of AD-AS in the figure above,if the economy is at point A in year 1 and is expected to go to point B in year 2,Congress and the president would most likely

Quizplus · Accepted Answer

If the economy is moving from point A to point B, it suggests an overheating economy or inflationary pressure. To counteract this, Congress and the president would likely increase taxes to reduce aggregate demand and cool down the economy.

Figure 18-3 -Refer to Figure 18-3.In the Dynamic Model of AD-AS in of AD-AS