Multiple Choice
The figure below shows equilibrium in an aggregate demand-aggregate supply model. Which of the following will be true of an economy in the long run that is at point M in the short run?
A) The actual price level will be lower than the expected price level.
B) The actual output will fall short of the potential output.
C) The short-run aggregate supply curve will remain stable at SRAS100.
D) The short-run aggregate supply curve will shift to SRAS109.
E) Real GDP will be equal to nominal GDP.
Correct Answer:
Verified
Correct Answer:
Verified
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