The figure above shows the U.S. demand and U.S. supply curves for cherries. At a world price of $2 per pound once international trade occurs, the total exports of cherries from the United States to other nations equals

Suppose the economy experiences an inflationary gap. Policymakers who believe that government is too big would favor which of the following policies to close the gap?

A) reduction in government spending B) increases in income tax rates C) increases in corporate tax rates D) increases in interest rates

If income falls without any change in interest rates, then according to the IS-LM model it may be true that:

a. money demand fell and government spending declined. b. the money supply increased and taxes declined. c. tight monetary policy and easy fiscal policy. d. easy monetary policy and easy fiscal policy.