Figure 7-6 -Refer to Figure 7-6. Suppose the Economy Is Initially at Is

question 164

Multiple Choice

Figure 7-6
-Refer to Figure 7-6. Suppose the economy is initially at point A. Now suppose that there is an increase in government purchases. In the short-run,

• A) the price level rises to P_b and real GDP increases to Y_b.
• B) the price level rises to P_d.
• C) the aggregate supply curve shifts up to SRAS₂.
• D) the economy's potential output increases to Y_b.

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Definitions:

Nearsightedness

A common vision condition, also known as myopia, where close objects appear clearly, but distant ones do not, due to the shape of the eye.

Presbycusis

Age-related hearing loss, gradually occurring in individuals as they grow older.

Macular Degeneration

Macular degeneration is a medical condition affecting the macula (part of the retina) that leads to vision loss, most commonly in older adults, characterized by the deterioration of the central portion of the retina.

Vaginal Dryness

Is a condition characterized by a lack of moisture in the vaginal area, which can cause discomfort and issues with sexual activity, typically associated with menopause.