Multiple Choice
The country of Glassen has experienced an expansionary gap for the last three years.The advocates of passive policy are likely to suggest a policy which causes _____.
A) the short-run aggregate supply to shift to the left.
B) the short-run aggregate supply to shift to the right.
C) rising prices to shift the aggregate demand to the left.
D) wages to fall relatively quickly.
E) aggregate demand to shift to the right as wages increase.
Correct Answer:
Verified
Correct Answer:
Verified
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