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Question 1

The graph below shows the AD-AS diagram for Slovenia.

What type of the GDP gap is observed in Slovenia?

 

Hint


Question 2

The graph below shows the AD-AS diagram for Brazil.

What type of fiscal policy should the government of Brazil be implementing to bring the economy to the long-run equilibrium?

 

Hint


Question 3

The graph below shows the AD-AS diagram for Spain.

How big is the recessionary gap?

 

Hint


Question 4

The graph below shows the AD-AS diagram for Slovenia.

Suppose that the government expenditure multiplier is equal to 3.

By how much should the government increase government expenditures (G) in order to close this recessionary gap?

 

Hint


Question 5

The graph below shows the AD-AS diagram for Spain.

How big is the inflationary gap?

 

Hint


Question 6

The graph below shows the AD-AS diagram for Norway.

Suppose that the government expenditure multiplier is equal to 6.

By how much should the government decrease government expenditures (G) in order to close this inflationary gap?

 

Hint