Figure 17-1 -Refer to Figure 17-1. Suppose the U.S. Economy Is at Economy

question 81

Multiple Choice

Figure 17-1
-Refer to Figure 17-1. Suppose the U.S. economy is at point j. With the onset of World War II, expansionary fiscal policies forced by the war pushed into an inflationary gap. Which of the following best illustrates this event?

• A) expansionary fiscal policies shifted the aggregate demand curve, creating an inflationary gap equal to (Y_n - Y_P).
• B) expansionary fiscal policies shifted the aggregate demand curve, creating an inflationary gap equal to (Y_m - Y_P).
• C) expansionary fiscal policies shifted the aggregate demand curve, creating an inflationary gap equal to (Y_m - Y_j).
• D) expansionary fiscal policies shifted the aggregate demand curve, creating an inflationary gap equal to (Y_n - Y_j).

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Definitions:

Maturation

Biological growth processes that enable orderly changes in behavior, relatively uninfluenced by experience.

Education

The process of facilitating learning or the acquisition of knowledge, skills, values, beliefs, and habits through various means.

Accommodation

In cognitive psychology, the process of modifying existing cognitive schemas, perceptions, and understandings to incorporate new information.

Biological Growth Processes

The natural and progressive development of an organism through stages of maturity, including changes in size, shape, and function.