Refer to the Graph Below

question 89

Multiple Choice

Refer to the graph below.Assume that the economy is in initial equilibrium where AS₁ intersects AD₁.Then a supply shock occurs that shifts AS₁ to AS₂.If the government counters with an expansionary fiscal policy that shifts AD₁ to AD₂, then it is most likely that:

• A)AD₂ will shift to AD₁.
• B)AS₂ will shift to AS₁.
• C)AS₂ will shift to AS₃.
• D)AS₂ will shift to AS₃ and AD₂ will shift to AD₁.

---

Definitions:

Group Interaction

The dynamics and exchanges that occur when individuals come together to communicate, collaborate, or compete.

Death Penalty

A legal punishment where a person is put to death by the state as a penalty for a crime.

Group Polarization

The phenomenon where a group's prevailing attitudes or beliefs become stronger or more extreme following group discussions.

Communication

The process of conveying information and ideas from one individual or group to another through spoken words, written text, or other mediums.