Use the Following to Answer Questions

question 106

Multiple Choice

Use the following to answer questions .
Exhibit: Supply-Side Economics
-(Exhibit: Supply-Side Economics) If the economy's long-run aggregate supply curve is LRAS₁, then at
Price level P₁ and real GDP level Y_P1, there is

• A) an inflationary gap.
• B) an opportunity to use discretionary fiscal or monetary policy to improve the economy.
• C) no gap, but the economy is not at its natural level of employment.
• D) no gap, and the economy is at its natural level of employment.

---

Definitions:

Blood Spots

Small areas of bleeding under the skin, often appearing as red or purple spots, also known as petechiae.

Designated Driver

A person chosen to abstain from alcohol on a social occasion so that they can drive others safely.

Lead Poisoning

A medical condition caused by high levels of the heavy metal lead in the body, leading to serious health issues including damage to the nervous system.

Tornado Sirens

Warning systems used to alert residents in an area about an approaching tornado, allowing them to seek safety promptly.