Consider the AD/AS Model

question 39

Multiple Choice

Consider the AD/AS model.An increase in government purchases will have no impact on equilibrium real GDP if

• A)the AS curve slopes upward.
• B)the AS curve is vertical.
• C)the AS curve is horizontal.
• D)the marginal propensity to spend is very small.
• E)the simple multiplier is very small.

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Definitions:

Cooperation

The process of working together towards the same end or to accomplish a shared goal.

Structuring

The act of organizing or arranging various elements into a systematic or coherent layout or framework.

Emphasize

To give special importance or prominence to something in speaking or writing.

Ineffective

Describes actions or methods that do not produce the intended result or fail to achieve objectives.