Suppose aggregate demand is at AD2 and a recession occurs. The goal of an automatic stabilizer would most likely be a.To shift aggregate demand from AD2 to AD3 b. To shift aggregate demand from AD3 to AD2 C.To shift aggregate demand form AD1 to AD2 d. To shift aggregate demand form AD3 to AD1 e. To keep aggregate demand stable at AD1

Microeconomics A Contemporary Intro
10th Edition
ISBN:9781285635101
Author:MCEACHERN
Publisher:MCEACHERN
Chapter18: Income Distribution And Poverty
Section: Chapter Questions
Problem 4QFR
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Suppose aggregate demand is at AD2 and a recession occurs. The goal of an automatic stabilizer would most likely be
a.To shift aggregate demand from AD2 to AD3
b. To shift aggregate demand from AD3 to AD2
C.To shift aggregate demand form AD1 to AD2
d. To shift aggregate demand form AD3 to AD1
e. To keep aggregate demand stable at AD1

AS
Price
Level
AD3
AD2
AD1
Real GDP
Transcribed Image Text:AS Price Level AD3 AD2 AD1 Real GDP
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