--%>
Assignment Help - homework help

Problem related to aggregate demand curve

Refer to the below diagram, in which Qf is the full-employment output. If aggregate demand curve AD1 describes the current situation, appropriate fiscal policy would be to: A) increase taxes and reduce government spending to shift the aggregate demand curve rightward to AD2. B) reduce taxes on businesses to shift the aggregate supply curve leftward. C) reduce taxes and increase government spending to shift the aggregate demand curve from AD1 to AD2. D) do nothing since the economy appears to be achieving full-employment real GDP.

1526_4.png

Help me to solve this problem

   Related Questions in Microeconomics

  • Q : Income of consumer-consequence on

    Income of consumer: In case of normal good - Increase in income leads to rise in quantity demanded of a normal good and reduce in income leads to reduction in quanti

    		•
  • Q : Economic profits with average total

    A monopolist can produce economic profits while: (w) average fixed costs [AFC] are very high. (x) average total costs [ATC] lies above the demand curve. (y) at least some portion of the average total costs [ATC] curve lies below the d

    		•
  • Q : Contestable Markets When consumers

    When consumers ultimately cannot distinguish one roasted chicken dinner from other, when roasted chicken dinners are produced within a constant cost industry, and when no barriers to entry or exit exist, in that case the long-

    		•
  • Q : Tax in long run relatively inelastic

    You daily buy author-published books of poetry that are relatively inelastically supplied within the long run. Then government imposes a tax upon books of poetry. Then tax is probable to be borne primarily through: (1) retail book stores. (2) consumer

    		•
  • Q : Consideration of positive statement

    Choose the right answer . A positive statement is concerned with: A) some goal that is desirable to society. B) what should be. C) what is. D) the formulation of economic policy.

    		•
  • Q : Short-run Demand for Labor Short-run

    Short-run demand for the labor would be LEAST affected by the: (i) Productivity of resource. (ii) Prices of substitute resources. (iii) Demand for goods generated by the resource. (iv) Fixed costs of firm. Can someone please help m

    		•
  • Q : Why are buyers and sellers forced to be

    Several buyers and sellers are forced to be price-takers since: (w) vigorous competition maintains individuals from noticeably influencing the market. (x) only monopoly firms adjust quantities. (y) markets adjust slowly. (z) quantity adjustment is not

    		•
  • Q : Marginal social benefit and costs under

    Under pure competition, there is marginal social benefit will equivalent marginal social cost unless: (w) “hit and run” entrepreneurs prosper. (x) economic profits are zero. (y) there are externalities. (z) entrepreneurs a

    		•
  • Q : Capital markets efficiency What is

    What is capital markets efficiency?

    		•
  • Q : Economic profits for most firms I have

    I have a problem in economics on Economic profits for most firms. Please help me in the following question. Economic profits for most of the firms will generally be: (1) The similar as their accounting profits. (2) Bigger than their accounting gains. (3) Less than the

    		•