Author Question: On the 45-degree line diagram, for points that lie above the 45-degree line A) planned aggregate ... (Read 108 times)

eruditmonkey@yahoo.com · **on:** Jun 29, 2018

On the 45-degree line diagram, for points that lie above the 45-degree line

A) planned aggregate expenditure is less than GDP.
B) planned aggregate expenditure is greater than GDP.
C) planned aggregate expenditure is equal to GDP.
D) planned aggregate expenditure is less than aggregate income.

Question 2

Refer to Figure 26-11. In the dynamic model of AD-AS in the figure above, if the economy is at point A in year 1 and is expected to go to point B in year 2, the Federal Reserve would most likely

A) decrease interest rates. B) not change interest rates.
C) decrease the inflation rate. D) increase interest rates.