1-Which is true in the aggregate supply / aggregate demand model?
A.The short run aggregate supply curve is upward-sloping.
B.All of these.
C.The aggregate demand curve is vertical.
D.The long run aggregate supply curve is? downward-sloping.
2-Contractionary fiscal policy would consist of
A.increasing government spending and/or decreasing taxes.
B.decreasing government spending and/or increasing taxes.
C.increasing government spending and/or increasing taxes.
D.decreasing government spending and/or decreasing taxes.
3-An inflationary gap occurs when
A.actual real GDP is greater than potential real GDP.
B.the long run equilibrium is above the short run equilibrium.
C.All of these are true.
D.the current output level is below the full employment level of production.