Based on the figure below. Starting from long-run equilibrium at point C, an increase in government spending that increases aggregate demand from AD to AD1 will lead to a short-run equilibrium at point ________ creating _____gap.  

Which one of the following will shift the consumption curve upward?

a. higher interest rates b. expectations that the economy will grow in the future c. a decrease in money holdings d. higher capacity utilization rates e. a tax cut

When an industry is monopolized, the move from a competitive environment to a monopoly leads to a decrease in consumer surplus and an increase in industry profits in a one-to-one ratio.

Answer the following statement true (T) or false (F)