Refer to the Information Provided in Figure 12

question 102

Multiple Choice

Refer to the information provided in Figure 12.8 below to answer the questions that follow.
Figure 12.8
-Refer to Figure 12.8.Suppose the economy is currently at Point A producing potential output Y₀.If the government increases spending,the economy moves to Point ________ in the short-run and to Point ________ in the long-run.

• A)D; E
• B)B; C
• C)C; B
• D)B; D

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Definitions:

Principal

The original amount of money borrowed or invested, excluding any interest or dividends.

Fault

In legal terms, refers to culpability or responsibility for wrongdoing or an accident, often determining liability in civil cases.

Ratify

To formally approve an agreement or treaty, making its provisions officially valid and binding.

Principal

The main party to a transaction, such as a borrower in a loan agreement or a buyer in a sales contract.