8. In the graph above, assume that the economy is currently in point E. In this situation, if the government does not take any policy measures to bring the economy to the fill-employment level of output, the economy will move toward point ____ in the long run.a. Cb. Ac. Dd. E9. (Continue to use the above graph) Again, assume that the economy is currently in point E. Now, the Fed wants to stabilize the output (that is, maintain the output at the full-employment level) by conducting monetary policy. Then the new equilibrium output will be at ___.a. Ab. Bc. Cd. De. E The following AD-AS diagram is only for the questions 8 and 9 only.LRASP-SRAS,SRAS2BSRAS;DADYY8. In the graph above, assume that the economy is currently in point E. In this situation, if thegovernment does not take any policy measures to bring the economy to the fill-employmentlevel of output, the economy will move toward pointin the long run.b. Ad. Ea. Cс. D9. (Continue to use the above graph) Again, assume that the economy is currently in point E.Now, the Fed wants to stabilize the output (that is, maintain the output at the full-employmentlevel) by conducting monetary policy. Then the new equilibrium output will be atd. Dа. Аb. Вс. Се. Е

Answered: The following AD-AS diagram is only for…

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter22: Aggregate Demand And Aggregate Supply

Section: Chapter Questions

Problem 1P

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Question

8. In the graph above, assume that the economy is currently in point E. In this situation, if the
government does not take any policy measures to bring the economy to the fill-employment
level of output, the economy will move toward point ____ in the long run.
a. C

b. A

c. D

d. E
9. (Continue to use the above graph) Again, assume that the economy is currently in point E.
Now, the Fed wants to stabilize the output (that is, maintain the output at the full-employment
level) by conducting monetary policy. Then the new equilibrium output will be at ___.
a. A

b. B

c. C

d. D

e. E

The following AD-AS diagram is only for the questions 8 and 9 only.
LRAS
P
-SRAS,
SRAS2
B
SRAS;
D
AD
Y
Y
8. In the graph above, assume that the economy is currently in point E. In this situation, if the
government does not take any policy measures to bring the economy to the fill-employment
level of output, the economy will move toward point
in the long run.
b. A
d. E
a. C
с. D
9. (Continue to use the above graph) Again, assume that the economy is currently in point E.
Now, the Fed wants to stabilize the output (that is, maintain the output at the full-employment
level) by conducting monetary policy. Then the new equilibrium output will be at
d. D
а. А
b. В
с. С
е. Е

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