According to this Application, one solution proposed to deal with the rising expenses of government entitlement programs is to raise taxes. An increase in taxes to help cover the rising expenses of entitlement programs would
A) increase aggregate demand, shifting the AD curve to the left.
B) decrease aggregate demand, shifting the AD curve to the left.
C) decrease aggregate demand, shifting the AD curve to the right.
D) increase aggregate demand, shifting the AD curve to the right.
Question 2
The maximum potential money multiplier is equal to
A) one minus the reserve ratio B) the reserve ratio.
C) the inverse of the required reserve ratio. D) the number of dollars on reserve.
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