-Refer to the Above Figure

question 69

Multiple Choice

-Refer to the above figure. If the economy is at E and the government wants to increase aggregate demand to AD3, but the increase in spending only shifts the aggregate demand curve to AD2, then

• A) complete crowding out has occurred.
• B) some crowding out has occurred.
• C) the increased borrowing caused interest rates to fall.
• D) the short-run aggregate supply curve is steeper than the figure indicates.

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Definitions:

Inventory Turnover

Inventory turnover is a ratio showing how many times a company's inventory is sold and replaced over a specific period, indicating the efficiency of inventory management.

Acid Test

A rigorous and conclusive test to prove the effectiveness or value of something.

Net Income

The total profit of a company after all expenses and taxes have been deducted from total revenue.

Total Debts

The sum of all financial obligations owed by an individual or organization, including both short-term and long-term liabilities.