If There Is an Inflationary Gap in the Economy, Discretionary

question 84

Multiple Choice

If there is an inflationary gap in the economy, discretionary fiscal policy would likely involve
An action to

• A) shift the aggregate demand curve to the right.
• B) shift the aggregate demand curve to the left.
• C) shift both the aggregate demand curve and aggregate supply curve to the right.
• D) shift both the aggregate demand curve and aggregate supply curve to the left.

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Definitions:

Black Bile

In ancient and medieval medicine, one of the four bodily humors believed to be associated with melancholy.

Essential Fluid

A necessary or critical bodily fluid for physiological functions, such as blood, lymph, or cerebrospinal fluid.

Trephination

An ancient medical procedure that involves drilling or scraping a hole into the human skull to treat health problems, believed to release evil spirits.

Blood Circulation

The continuous movement of blood through the heart and blood vessels, delivering nutrients and oxygen to all parts of the body.