Figure 35-9

question 42

Multiple Choice

Figure 35-9. The left-hand graph shows a short-run aggregate-supply SRAS) curve and two aggregate-demand AD) curves. On the right-hand diagram, "Inf Rate" means "Inflation Rate."
-Refer to Figure 35-9. The shift of the aggregate-supply curve from AS1 to AS2 could be a consequence of

• A) an increase in the money supply.
• B) an adverse supply shock.
• C) a decrease of output from Y1 to Y2.
• D) a slow adjustment of people's expectation of the inflation rate.

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Definitions:

Dependent

Someone who relies on another, particularly for financial support, often a child or other family member as defined for tax purposes.

Medical Services

Professional services provided by doctors, nurses, or any healthcare providers, typically aimed at diagnosing, treating, or preventing illness.

Itemized Deduction

Specific expenses allowed by the IRS that can be subtracted from AGI to decrease taxable income.

AGI Floor

A threshold based on a taxpayer's adjusted gross income (AGI) that limits the deductibility of certain expenses.