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Author Question: In the long run, what effect does a government's deficit spending have on equilibrium real Gross ... (Read 135 times)

Jkov05

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on: Jun 30, 2018
In the long run, what effect does a government's deficit spending have on equilibrium real Gross Domestic Product (GDP)?
 
  A) Equilibrium real Gross Domestic Product (GDP) will increase beyond the full-employment level and there will also be an inflationary effect.
  B) Higher government deficits will not raise equilibrium Gross Domestic Product (GDP) above the full-employment level.
  C) Deficit spending will decrease the nation's equilibrium real Gross Domestic Product (GDP).
  D) The government's deficit spending will increase equilibrium real Gross Domestic Product (GDP).

Question 2

A reduction in nominal wages will cause which of the following?
 
  A) a leftward shift in the short-run aggregate supply curve to shift to the left
  B) a movement along the short-run aggregate supply curve
  C) a shift of both the short-run and long-run aggregate supply curves
  D) a rightward shift in the short-run aggregate supply curve


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fur

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Reply #1 on: Jun 30, 2018
Answer to Question 1

B

Answer to Question 2

D


Jkov05

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Reply 2 on: Jun 30, 2018
Great answer, keep it coming :)

bimper21

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Reply 3 on: Yesterday
Wow, this really help

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