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question 208

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Use the following to answer questions :
Figure: AD-AS Use the following to answer questions : Figure: AD-AS   -(Figure: AD-AS)  Look at the figure AD-AS. Suppose the economy is initially at E<sub>1</sub>, where AD<sub>1 </sub>intersects SRAS<sub>1</sub> and LRAS. Now, suppose that the AD<sub>1 </sub>shifts to AD<sub>2. </sub>That shift could be due to: A) an increase in the aggregate price level. B) a decrease in government expenditure. C) an increase in tax rates. D) an increase in money supply.
-(Figure: AD-AS) Look at the figure AD-AS. Suppose the economy is initially at E1, where AD1 intersects SRAS1 and LRAS. Now, suppose that the AD1 shifts to AD2. That shift could be due to:


Definitions:

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A period in the Dutch Golden Age where contract prices for tulip bulbs reached extraordinarily high levels and then dramatically collapsed.

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