Multiple Choice
-Based on the diagram above,starting from a long-run equilibrium at point C,a decrease in government spending that decreases aggregate demand from ADI1 to ADI will lead to a short-run equilibrium at ________,creating _________ gap.
A) D;an expansionary
B) D;a recessionary
C) D;no output
D) B;an expansionary
E) B;a recessionary
Correct Answer:
Verified
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