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Consider an AD/AS Model in Long- Run Equilibrium

Question 22

Multiple Choice

Consider an AD/AS model in long- run equilibrium. An output gap, caused by a leftward shift of the AD curve, would be eliminated if


A) wages and other factor prices fell quickly.
B) the AS curve shifted upward.
C) real national income decreased.
D) wages rose quickly.
E) prices rose quickly.

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