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Exhibit 16-2 -Refer to Exhibit 16-2.Suppose the Economy Starts Out at Point

Question 27

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Exhibit 16-2
Exhibit 16-2 -Refer to Exhibit 16-2.Suppose the economy starts out at point A and the public correctly anticipates that the AD curve will shift from AD<sub>1</sub> to AD<sub>2</sub>.If wages are temporarily fixed,SRAS<sub>1</sub> will __________ and the economy will end up at point __________. A) shift; D B) shift; B C) not shift; D D) not shift; E
-Refer to Exhibit 16-2.Suppose the economy starts out at point A and the public correctly anticipates that the AD curve will shift from AD1 to AD2.If wages are temporarily fixed,SRAS1 will __________ and the economy will end up at point __________.


A) shift; D
B) shift; B
C) not shift; D
D) not shift; E

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