Figure 35-3

question 2

Multiple Choice

Figure 35-3.The left-hand graph shows a short-run aggregate-supply (SRAS) curve and two aggregate-demand (AD) curves.On the left-hand diagram,Y represents output and on the right-hand diagram,U represents the unemployment rate.
-Refer to Figure 35-3.What is measured along the vertical axis of the right-hand graph?

• A)the interest rate
• B)the inflation rate
• C)the government's budget deficit as a percent of GDP
• D)the growth rate of the nominal money supply

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Definitions:

U.S. Bureau of the Census

A principal agency of the U.S. Federal Statistical System, responsible for producing data about the American people and economy.

Related Children

Children who live in a household and are related to the householder by birth, marriage, or adoption.

Transitory Income

Temporary earnings that can cause fluctuations in an individual's purchasing power and consumption habits.

Permanent Income

An economic theory suggesting that people's consumption choices are influenced more by their lifetime income expectations than by their current income.