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Suppose the Economy Is Operating in Long-Run Equilibrium and a Positive

Question 159

Multiple Choice

Suppose the economy is operating in long-run equilibrium and a positive demand shock hits. We expect a short-run increase in real GDP and the price level and a long-run _____ in real GDP and _____ the price level.


A) decrease; increase
B) increase; increase
C) decrease; decrease
D) increase; decrease

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