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Quiz. Quiz o This question: 5 point(s) possible Consider the following diagram, in which the current short-run equilibrium is at point A. LRAS SRAS a.

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Quiz. Quiz o This question: 5 point(s) possible Consider the following diagram, in which the current short-run equilibrium is at point A. LRAS SRAS a. At point A, the economy has an inflationary gap b. If the marginal propensity to consume equals 0.8, to eliminate the gap, the government should decrease spending by $ trillion. (Round your answer to two decimal places.) 122 118 Price Level 114 .. . ...... AD 22 22.8 23.6 0- Real GDP per Year ($ trillion)

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