130 120 Price level (GOP dellator, 2009-1001 7110 A AD 100 90 AD ADO 0156 15.8 160 162 164 16.6 Reol GDP Millions of 200

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130 120 Price Level Gop Dellator 2009 1001 7110 A Ad 100 90 Ad Ado 0156 15 8 160 162 164 16 6 Reol Gdp Millions Of 200 1 (93.5 KiB) Viewed 53 times

130 120 Price level (GOP dellator, 2009-1001 7110 A AD 100 90 AD ADO 0156 15.8 160 162 164 16.6 Reol GDP Millions of 2009 dollars 25) In the above figure, the economy is initially at point B. Suppose that government increases the taxes, then there is A) a movement to point C. B) a movement to point A. C) a shift to AD D) a shift to AD 26) In the above figure, the economy is initially at point B. If the government decreases transfer payments, there is A) a movement to point C. B) a movement to point A. C) a shift to AD D) a shift to AD 8 130 8 120 110 ឱ 7100 0 AD AD 0 15.0 155 160 165 170 17.5 Real GDP fillions of 2009 dollars! 27) In the above figure, the movement from point A to point B might be the result of A) an increase in government expenditures because of increases in education expenditures. B) a rise in the price level. C) an increase in the demand for manufacturing goods because of new technology. D) an increase in government expenditures because of a war. LAS 130 SAS 120 110 ៦ 100 90 Jople ou rice AD AD ADE "15.0 15.5 16.0 16.5 17.0 17.5 0 28) In the above figure, point B represents A) a recessionary gap. B) a full-employment equilibrium. C) an inflationary gap. D) a decrease in AD. 29) In the above figure, point C represents A) a recessionary gap. B) a full-employment equilibrium. C) an inflationary gap. D) a decrease in AD.