Which component of current U.S. GDP under the expenditure approach is most likely to be negative?

In the classical model, what happens to the level of real GDP if aggregate demand increases?

A) Real GDP increases. B) Real GDP decreases. C) Real GDP would increase at first, then decrease. D) Real GDP would remain the same, at equilibrium.

Initially, the U.S. and the IMF believed that

A) the Debt Crisis would require long-term structural changes. B) Latin American economies did not need assistance. C) capital inflows would be unable to solve the debt problems. D) the Debt Crisis was a temporary liquidity problem.