Question

Fiscal policies typically affect the short-run level of GDP because they cause shifts in the ________,...

Fiscal policies typically affect the short-run level of GDP because they cause shifts in the ________, but they will not generally have any long-run effects on real GDP unless they affect ________.

A) AD curve; factor-utilization rates

B) AD curve; the unemployment rate

C) AD curve; the level of potential output

D) AS curve; factor supplies or factor productivity

E) AS curve; factor-utilization rates

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