If the expenditure multiplier is $2,$ and households save the extra income which they receive from a $1$bn tax cut, then we expect the change in national income to be

$0$

$-0\mathrm{.}5$bn

$+2$bn

$+0\mathrm{.}5$bn

Which of these statements reflects the assumptions which New Classical economists typically make about aggregate supply?

Both long$-$run and short$-$run AS curves slope upwards, but the short$-$run curve is steeper than the long$-$run curve

There is a single AS curve, which is horizontal when there is unemployment, and vertical when there is full employment

The short$-$run AS curve is horizontal, but the long$-$run AS curve is vertical

The long run AS curve is vertical, and the short run AS is upward sloping

Cost push inflation occurs when

The government increases its budget deficit

Anticipating inflation, households accelerate purchases

The price of commodities used in production increases

Monetary financial institutions increase their liquidity ratio