On the following greph, AD, represents the initial aggregote demand curve in a hypothetical economy, and A5 represents the initial aggregate supply curve. The economy's full-employment output is $12 billion. On the following graph, use the grey point (star symbol) to mark the equithrium. (Note: You wil not be graded on any adjustments made to the graph.) The initial shart-run equil brium level of real GDP is bilion, and the initial short-run equidibrium price levei is Suppose the government, seeking full employment, borrows money and increases its expenditures by the amount a belleves necessary to close the output gap. Acconding to critics of Keynesian fiscal policy, the government palicy may result in partial crowding out. Which of the following aggregate demand curves shown in the previous graph would be consistent with partial crowding out? AD2AD3AD4 As a result, the equilibrium level of real GDP wi be bilion, and the equilionum price level will be According to critics of Keynesian fiscal policy, which of the following is true in this case? The increase in deficit-financed government spending has no impsct oe real cop and the price level. Real GDP does not increase; only the price level increases. The increase in deficit-financed government spending causes real GDp to increase to full-employment oulput The increase in deficit-financed govemment spending causes real GDP to increase, but not to full-employment output