Multiple Choice
Refer to the graph shown. Assume the economy is in short-run equilibrium at point A below potential output. The government opts for an expansionary fiscal policy in an attempt to pull the economy out of the recession. An economist with a Classical view holding the Ricardian equivalence theorem to be practically true would conclude that the economy will most likely end up at point: 
A) A.
B) B.
C) C.
D) D.
Correct Answer:
Verified
Correct Answer:
Verified
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