The government is concerned about an inflationary gap. Shift the AD curve to provide a graphical representation of an inflationary gap and move the point, ESR, to the short-run equilibrium associated with the inflationary gap. Which of the following policies will help to eliminate the inflationary gap? O an increase in government transfers a tax cut an increase in military spending an increase in taxes Aggregate price level SR LRAS Real GDP AD SRAS

The government is concerned about an inflationary gap. Shift the AD curve to provide a graphical representation of an inflationary gap and move the point, ESR, to the short-run equilibrium associated with the inflationary gap. Which of the following policies will help to eliminate the inflationary gap? O an increase in government transfers a tax cut an increase in military spending an increase in taxes Aggregate price level SR LRAS Real GDP AD SRAS

Principles of Economics (MindTap Course List)

8th Edition

ISBN:9781305585126

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter34: The Influence Of Monetary And Fiscal Policy On Aggregate Demand

Section: Chapter Questions

Problem 4CQQ

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