When the Current Short-Run Equilibrium Is to the Right of the Long-Run

question 211

Multiple Choice

When the current short-run equilibrium is to the right of the long-run aggregate supply, appropriate discretionary fiscal policy used to address this problem would be to

• A) increase taxes.
• B) decrease taxes.
• C) increase government spending.
• D) decrease the discount rate.

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Definitions:

Distress

Severe anxiety, sorrow, or pain; in a legal context, the seizure of property to compel payment or performance of a duty.

Rental Arrears

The amount of money owed by a tenant for rent that has not been paid by the due date.

Seize and Sell

A legal process where authorities or creditors take and then sell the assets of a debtor to recover owed money.

Water Purifier

A water purifier is a device that removes impurities and contaminants from water, making it safe for drinking and other uses.