If the Economy Is on the Steep Part of the AS Curve

question 346

Multiple Choice

If the economy is on the steep part of the AS curve, the multiplier will be

• A) larger than it would be if the economy were on the flat portion of the AS curve.
• B) smaller than it would be if the economy were on the flat portion of the AS curve.
• C) constant regardless of where the economy is on the AS curve.
• D) infinite, as compared to zero if the economy is on the flat portion of the AS curve.