Refer to the Graph Below

question 67

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.

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Definitions:

Readiness to Change

A measure of an individual's willingness to adopt new behaviors or take action towards personal growth or improvement.

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Contracts

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