Solved

Based on the Figure Below

Question 163

Multiple Choice

Based on the figure below. Starting from long-run equilibrium at point C, a tax cut that increases aggregate demand from AD to AD1 will lead to a short-run equilibrium at point ___ and eventually to a long-run equilibrium at point ____, if left to self-correcting tendencies. Based on the figure below. Starting from long-run equilibrium at point C, a tax cut that increases aggregate demand from AD to AD<sup>1</sup> will lead to a short-run equilibrium at point ___ and eventually to a long-run equilibrium at point ____, if left to self-correcting tendencies. A) D; B B) D; C C) B; A D) B; C


A) D; B
B) D; C
C) B; A
D) B; C

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Q35: When actual output equals potential output and

Q54: When there is a recessionary gap, inflation

Q71: When the Federal Reserve increases its target

Q88: Starting from long-run equilibrium, an increase in

Q95: The aggregate demand curve shifts to the

Q120: Starting from long-run equilibrium, a sharp drop

Q132: When actual output equals potential output there

Q154: Based on the figure below. An economy

Q160: Based on the figure below. An economy

Q162: According to the Aggregate Demand Aggregate Supply