Figure 12-3 -Refer to Figure 12-3. If the Aggregate Demand Curve Is

question 101

Multiple Choice

Figure 12-3
-Refer to Figure 12-3. If the aggregate demand curve is AD₀, which of the following is the most
Appropriate discretionary fiscal policy to pursue?

• A) increase government spending, increase individual income tax rates, and increase corporate income tax rates
• B) increase government spending, increase individual income tax rates, and decrease corporate income tax rates
• C) increase government spending, decrease individual income tax rates, and decrease corporate income tax rates
• D) maintain existing government spending, individual income tax rates, and corporate income tax rates

---

Definitions:

Taste Preferences

Individual differences in liking or disliking of flavors or food items.

Visual Illusions

Perceptual experiences where the visual perception of an object or scene diverges significantly from reality, often exploring the nature of human visual perception.

Door-In-The-Face Technique

A persuasion strategy that involves making a large request that is expected to be refused in order to make a smaller request seem more reasonable.

Frugal

Characterized by thriftiness and economical use of resources, avoiding waste and unnecessary expense.