-Refer to the Above Figure

question 77

Multiple Choice

-Refer to the above figure. Suppose that the economy was originally at point A, and then it reached point C by means of a fiscal policy action. Which of the following is correct?

• A) Point C is a short-run equilibrium that could have been attained through a tax cut, but in the long run the economy will end up at point B.
• B) Point C is both a short-run equilibrium and a long-run equilibrium that could have been attained through an increase in government spending.
• C) Point C is a long-run equilibrium that could have been attained through a tax increase, although reaching this point first required a short-run equilibrium at point B.
• D) Point C is a short-run equilibrium that could have been attained through a reduction in government spending, but in the long run the economy will end up at point B.

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Definitions:

Social People

Individuals who exhibit a high degree of sociability, enjoying being with others and participating in social activities.

Tactful

The ability to communicate and act in a way that considers other people's feelings and reactions, often to avoid offense or conflict.

Effective Delegation

The skill of assigning tasks or responsibilities to others in a way that maximizes efficiency, development, and outcomes.

Development Tool

Resources or instruments utilized to facilitate personal, organizational, or technological growth and improvement.