Answer this question using the AS / AD model presented in the textbook.Which of the following would cause a reduction in the natural level of output in the medium run?
A)a decrease in government spending
B)a decrease in the money supply
C)an increase in taxes
D)both A and C
E)none of the above

Question

Quizplus · Accepted Answer

In the AS/AD model, the natural level of output is determined by factors such as technology, resources, and labor market conditions, not by fiscal or monetary policy changes like government spending, money supply, or taxes.

Answer This Question Using the AS / AD Model Presented