$10 11 11.3 Real GDP point A in year 1 and is expected to go to point B in year 2, Congress and the president would most likely increase the money supply and decrease the interest rate. increase taxes. increase government spending. increase oil prices.

$10 11 11.3 Real GDP point A in year 1 and is expected to go to point B in year 2, Congress and the president would most likely increase the money supply and decrease the interest rate. increase taxes. increase government spending. increase oil prices.

ECON MACRO

5th Edition

ISBN:9781337000529

Author:William A. McEachern

Publisher:William A. McEachern

Chapter11: Fiscal Policy

Section: Chapter Questions

Problem 1.4P

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Question

Figure 16-6
Price level
104
100
LRAS,
LRAS₂
SRAS,
SRAS₂
AD₂
Refer to Figure 16-6. In the dynamic model of AD-AS in the figure above, if the economy is at
0
$10
11 11.3 Real GDP
point A in year 1 and is expected to go to point B in year 2, Congress and the president would most likely
O increase the money supply and decrease the interest rate.
O increase taxes.
● increase government spending.
O increase oil prices.
Oraise interest rates.

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