In the Above Figure, If the Relevant Aggregate Demand Curve

question 348

Multiple Choice

In the above figure, if the relevant aggregate demand curve is AD2, what type of gap exists and how large is it?

• A) inflationary gap of $500 billion
• B) inflationary gap of $1 trillion
• C) recessionary gap of $1 trillion
• D) recessionary gap of $500 billion

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Definitions:

Autonomic

Pertaining to the autonomic nervous system, which controls involuntary body functions like heart rate and digestion.

Somatic Nervous Systems

A part of the peripheral nervous system associated with voluntary control of body movements via the use of skeletal muscles.

Sensory Systems

Sensory systems are the parts of the nervous system responsible for processing sensory information from the environment, including sight, sound, touch, taste, and smell.

Commands

Directives or instructions given with authority, meant to be followed or executed by the recipient.