The Figure Below Shows the Price Level,real GDP,and the Potential

question 18

Multiple Choice

The figure below shows the price level,real GDP,and the potential output for an economy.According to those who favor a passive approach to policy,the economy will attain equilibrium at potential output when:

• A)the SRAS curve will shift to the left.
• B)the SRAS curve will shift to the right.
• C)either the money supply or government spending is increased.
• D)the money supply is decreased.
• E)aggregate demand will decrease.

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Definitions:

Debit Memo

A document issued to adjust downwards the amount of money owed to a business by a customer or another business.

Journal Entries

Entries made in a journal documenting every financial transaction of a business and used as the first step in the accounting cycle.

Outstanding Checks

Checks that have been written and recorded in the payer's accounting records but have not yet been cashed or deposited by the payee.

Petty Cash

A modest sum of money maintained in reserve for small, unplanned costs.