An economy is currently operating with a recessionary gap. Suppose the policymakers in this economy are activists and they want this economy to return to the full employment level of real GDP. Given this information and holding everything else constant and using the AD/AS model, how many of the following statements are true?

r .~ Ad'i' An economy is currently operating with a recessionary gap. Suppose the policymakers in this economy are activists and they want this economy to return to the full employment level of real GDP. Given this information and holding everything else constant and using the AD/AS model, how many of the following statements are true? I. Fiscal policy in the form of increased government spending will help to return this economy to the full employment level of real GDP. ll. Monetary policy in the form of increasing the demand for money will help to return this economy to the full employment level of real GDP. III. Fiscal policy in the form'of decreased taxation and decreased government spending by an equivalent dollar amount will help to return this economy to the full employment level of real GDP. IV. Monetary policy in the form of increasing the supply of money will help to return this economy to the full employment level of real GDP. 0 Three statements are true. 0 Two statements are true. 0 Four statements are true. .0 One statement is true