Refer to the graph shown. No changes in fiscal policy are advisable when the economy is at point:

A. A.
B. B.
C. C.
D. D.

Answer: C

Economics

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An increase in the price level in the United States will have what effect on the aggregate expenditure line?

A) Aggregate expenditure will shift upward. B) Aggregate expenditure will become steeper. C) Aggregate expenditure will shift downward. D) Aggregate expenditure will not be affected by an increase in the price level in the United States.

Economics

The tendency of workers to supply more labor in response to a larger reward for working is called the ________ of a higher real wage on the quantity of labor supplied

A) homogeneous labor supply effect B) negative correlation effect C) income effect D) substitution effect

Economics