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Question 282

Multiple Choice

Use the following to answer questions:
Figure: AD-AS Use the following to answer questions: Figure: AD-AS -(Figure: AD-AS) Refer to Figure: AD-AS. Suppose that initially the economy is at long-run equilibrium. If the government cuts taxes, _____ will shift to the _____. A) SRAS; right B) SRAS; left C) AD<sub>1</sub>; right to AD<sub>2</sub> D) AD<sub>1</sub>; left to AD<sub>3</sub>
-(Figure: AD-AS) Refer to Figure: AD-AS. Suppose that initially the economy is at long-run equilibrium. If the government cuts taxes, _____ will shift to the _____.


A) SRAS; right
B) SRAS; left
C) AD1; right to AD2
D) AD1; left to AD3

Correct Answer:

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