I need help with questions 1, 1a, 2,15 and 16?

la. Refer to the above figure. Suppose the economy is operating at point A. There is a recessionary gap of _ _ _ _ , which can be closed by _ _ _ _

A) $3 trillion; increasing government spending by $1 trillion

B) $1 trillion; expansionary fiscal policy that shifts the short-run aggregate supply curve through point C

C) $2 trillion; expansionary fiscal policy that generates another $2 trillion in total spending D) $2 trillion; an increase in government spending of $14 trillion

inal Exam ECON 220 Macro Economic Business Department Professor Jorge Romero all 2018 Term A Mercy College Where necessary please show all computations in order to get full credit for your answer Price Level Led 1 was King Real GDPYear la . Refer to the the above figure . Suppose the economy is opera is operating at point A . There is a recessionary gap o which can be closed by A ) 83 trillion ; increasing government spending by SI trillion B ) $1 trillion expansionary fiscal policy icy that shifts the short -run aggregate supply curve through point C ( ) $2 trillion ; expansionary fiscal policy that generates another $2 trillion in total spending D ) $2 trillion ; an increase in government spending of S14 trillion 1 6 Refer to the above figure . Suppose the economy is at point A . By the proper use of fiscal policy , the government can A ) boost taxes to shift LRAS through point A B ) increase government spending to get the economy to point B ( ) raise income tax rates to get the economy to point D ) reduce government spending to get the economy to point D