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-The Figure Above Illustrates the Aggregate Demand, Short-Run Aggregate Supply

Question 246

Multiple Choice

-The figure above illustrates the aggregate demand, short-run aggregate supply, and long-run aggregate supply in Lotus Land. The economy is currently at point D and the government decreases its taxes. The economy will move to ________. The price level will ________, and the change in real GDP will be ________ the increase in aggregate demand. A) point A; fall; less than B) point D; rise; less than C) point C; rise; less than D) point B; remain constant; the same as
-The figure above illustrates the aggregate demand, short-run aggregate supply, and long-run aggregate supply in Lotus Land. The economy is currently at point D and the government decreases its taxes. The economy will move to ________. The price level will ________, and the change in real GDP will be ________ the increase in aggregate demand.


A) point A; fall; less than
B) point D; rise; less than
C) point C; rise; less than
D) point B; remain constant; the same as

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