With an upward-sloping aggregate supply curve, real output can be increased to the fullemployment output level if:
A. Government expenditures are increased by the amount of the GDP gap.
B. Government expenditures are increased by the amount of the AD shortfall.
C. Aggregate demand is increased by the amount of the GDP gap.
D. Government expenditures are increased by the amount of the AD shortfall divided by the multiplier.
Answer:D
With an upward-sloping aggregate supply curve, real output can be increased to the fullemployment output level if:
A. Government expenditures are increased by the amount of the GDP gap. B. Government expenditures are increased by the amount of the AD shortfall. C. Aggregate demand is increased by the amount of the GDP gap. D. Government expenditures are increased by the amount of the AD shortfall divided by the multiplier.