LRAS SRAS AD Real GOP Year 49) Refer to the above figure. If the economy is curr
ID: 1128007 • Letter: L
Question
LRAS SRAS AD Real GOP Year 49) Refer to the above figure. If the economy is currently operating at point C, then there is 49) A) unemployment. C) a recessionary gap. B) a stable long-run equilibrium situation. D) an inflationary gap. 50) Fiscal policy refers to the 50) A) adjustment of government spending and taxes in order to achieve certain national economic goals. B) adjustment of national income data to account for price level changes. C) manipulation of the money supply in order to increase the amount of paper currency in circulation. D) changing the way unemployment data is calculated so as to make it appear that unemployment is lower than it actually is.Explanation / Answer
49. Since at point C output is more than the full employment level hence there is an inflationary gap.
So, option D)
50. Fiscal policy refers to changes that takes place in taxes and in government spending to keep in check the nation's economy.
So option a)
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