Question 1
Refer to the information provided in Figure 28.7 below to answer the question(s) that follow.
Refer to Figure 28.7. Suppose the economy is initially at Point
A. An expansionary fiscal policy moves the economy to Point ________ in the short run.
◦
E◦
B◦
C◦
DQuestion 2
Refer to the information provided in Figure 28.7 below to answer the question(s) that follow.
Refer to Figure 28.7. Suppose the economy is at Point
B. What can possibly move the economy to Point
E?
◦ a leftward shift in the
AD curve
◦ a rightward shift in the
AD curve
◦ a leftward shift in the
AS curve
◦ a rightward shift in the
AS curve