객관식
The wealth effect along an aggregate-demand curve stems from the idea that a higher price level:
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1. Introduction to Macroeconomics
Introduction to Economics
객관식
Suppose the government increases its spending while the economy is currently operating below potential output. How will this change affect the output gap?
A
The output gap will remain unchanged.
B
The output gap will become negative as actual output exceeds potential output.
C
The output gap will decrease as actual output moves closer to potential output.
D
The output gap will increase as actual output moves further below potential output.
검증된 단계별 안내1
Step 1: Understand the concept of the output gap, which is defined as the difference between actual output (Y) and potential output (Y*), often expressed as Output Gap = Y - Y*. A positive output gap means the economy is producing above potential, while a negative gap means it is below potential.
Step 2: Recognize that when the economy is operating below potential output, the output gap is negative (Y < Y*). This indicates underutilized resources and economic slack.
Step 3: Analyze the effect of an increase in government spending, which is a component of aggregate demand (AD). An increase in government spending shifts the aggregate demand curve to the right, increasing total demand in the economy.
Step 4: Understand that as aggregate demand increases, actual output (Y) rises, moving closer to potential output (Y*). This reduces the negative output gap because the economy is producing more and utilizing resources more fully.
Step 5: Conclude that the output gap decreases (becomes less negative) as actual output moves closer to potential output due to the fiscal stimulus from increased government spending.
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