The table below shows the aggregate equilibrium for the country of Microtania. Aggregate Data Year Microtania Potential Aggregate Output Current Aggregate Output Price Level 2014 2015 in billions 400 500 In 2014, Microtania experienced a ORecessionary gap OInflationary gap in billions 350 80 450 87 OPotential equilibrium What would be an appropriate action for the government of Microtania to take? ORaise taxes OIncrease government spending ONothing

The table below shows the aggregate equilibrium for the country of Microtania. Aggregate Data Year Microtania Potential Aggregate Output Current Aggregate Output Price Level 2014 2015 in billions 400 500 In 2014, Microtania experienced a ORecessionary gap OInflationary gap in billions 350 80 450 87 OPotential equilibrium What would be an appropriate action for the government of Microtania to take? ORaise taxes OIncrease government spending ONothing

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter19: The Macroeconomic Perspective

Section: Chapter Questions

Problem 4SCQ: Without looking at Table 19.7, return to Figure 19.10. If we define a recession as a significant...

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