Assume the Economy Is Currently in Long-Run Equilibrium at Its

Multiple Choice

Assume the economy is currently in long-run equilibrium at its potential output and that it is subjected to a positive demand shock.When the economy moves back to producing its potential level of national income,the price level will be

A) equal to what it was originally before the demand shock.
B) lower than it was in short-run equilibrium and the lower than it was originally.
C) lower than it was in the short-run equilibrium but higher than it was originally.
D) higher than it was in the short-run equilibrium but lower than it was originally.
E) higher than it was in the short-run equilibrium and even higher than it was originally.