Consider the Following Statement: "If the Government Attempts to Raise

question 49

Multiple Choice

Consider the following statement: "If the government attempts to raise employment through increased fiscal spending, all it will end up doing is increasing the price level." The statement rests on the assumption that:

• A) the aggregate demand curve is a horizontal line.
• B) the aggregate supply curve is a vertical line.
• C) the aggregate supply curve is upward-sloping.
• D) the aggregate supply curve is downward-sloping.
• E) the aggregate supply curve is a horizontal line.

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Definitions:

Federal Welfare

Government-provided financial aid and services to individuals in need, typically funded through tax revenues at the federal level.

Income-Support Structure

Systems or programs designed to provide financial assistance to individuals or households with inadequate or no income.

Charles Murray

An American political scientist and author known for his work on social policy and intelligence in the United States.

Female-Headed Household

A household led by a woman, often used in discussions about demographics, economics, and social issues.