Multiple Choice
According to the AD-AS model,if the economy is initially at its long-run potential growth rate,then a temporary increase in the growth rate of investment spending will cause:
A) an increase in the real growth rate in the long run.
B) an increase in the inflation rate in the long run.
C) an increase in both the inflation and real growth rates in the short run.
D) no effect on real growth rate or inflation in the short run.
Correct Answer:
Verified
Correct Answer:
Verified
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