Author Question: Refer to the information provided in Figure 29.2 below to answer the question(s) that follow.Refer ... (Read 12 times)

Melani1276 · **on:** Apr 19, 2019

Question 1

Refer to the information provided in Figure 29.2 below to answer the question(s) that follow.

Refer to Figure 29.2. If the economy is currently at Point
B and policy makers implement a policy which shifts the aggregate demand curve to
AD
₁, the time the economy needs to make the adjustment is known as the

◦ implementation lag.
◦ recognition lag.
◦ response lag.
◦ frictional lag.

Question 2

Refer to the information provided in Figure 29.2 below to answer the question(s) that follow.

Refer to Figure 29.2. If economic policy causes aggregate demand curve shifts from
AD
₂ to
AD
₁, then

◦ output decreases to
Y
₀ and the price level decreases to
P
₀.
◦ output decreases to less than
Y
₁.
◦ the price level decreases lower than
P
₀ and output decreases to
Y
₀.
◦ None of these.

BUTTHOL369 · **Reply #1 on:** Apr 19, 2019

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