Suppose the Economy Is in a Recession and the Government

question 40

Multiple Choice

Suppose the economy is in a recession and the government decides it needs to reduce the budget deficit.Other things equal,this would tend to

• A) shift the IS curve to the right.
• B) shift the IS curve further to the left.
• C) shift the MP curve further down.
• D) shift the MP curve up.

---

Definitions:

Visual Pathways

The route by which visual signals travel from the eye to the brain for processing and interpretation.

Retina

The light-sensitive layer of tissue at the back of the inner eye, which converts light rays into nerve signals that are sent to the brain to create visual images.

Optic Nerve

A cranial nerve that transmits visual information from the retina to the brain.

Sympathetic Branch

Part of the autonomic nervous system that activates the fight or flight response, responsible for increasing heart rate, blood pressure, and energy mobilization.