High School

The major macroeconomic problems can be resolved by the appropriate shifting of the:

A. SRAS curve
B. Aggregate spending curve
C. AD curve
D. All of the above

Answer :

(Option d). The major macroeconomic problems can be resolved by shifting the SRAS curve, the Aggregate Spending curve, or the AD curve.

The major macroeconomic problems can indeed be resolved by the appropriate shifting of various curves in economic models. These curves include the Short-Run Aggregate Supply (SRAS) curve, the Aggregate Demand (AD) curve, and the Aggregate Spending curve.

1. Shifting the SRAS Curve: Short-term supply shocks or changes in productivity can affect SRAS. For example, a decrease in energy prices can shift the SRAS curve to the right, leading to lower prices and higher output.

2. Shifting the AD Curve: Policies that increase consumer spending, investment, government expenditure, or net exports can shift the AD curve to the right. This can help in times of recession, pulling the economy towards full employment. Conversely, contractionary policies can shift the AD curve to the left to combat inflation.

3. Shifting the Aggregate Spending Curve: Aggregate spending, which includes consumption, investment, government spending, and net exports, can also affect overall economic output. Fiscal policies, like tax cuts or increases in government spending, can shift this curve.

Hence, the correct option is d.