Use the Following to Answer Questions

question 25

Multiple Choice

Use the following to answer questions :
Figure: AD-AS Model and the Short-Run Phillips Curve
-(Figure: AD-AS Model and the Short-Run Phillips Curve) Look at AD-AS Model and the Short-Run Phillips Curve. If the central bank decreases the money supply so that aggregate demand shifts from AD₂ to AD₁, then the unemployment rate will be:

• A)zero.
• B)2%.
• C)4%.
• D)6%.

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Definitions:

Equilibrium Quantity

The quantity of goods or services that is supplied and demanded at the equilibrating price in a market.

Positive Externality

A beneficial effect experienced by a third party due to a transaction or activity they were not involved in.

Property Values

The worth of real estate as determined by market conditions and the property's condition, location, and other factors.

Renovates

The process of improving or updating a building, room, or structure to make it more attractive or functional.