Multiple Choice
Assume that the aggregate demand increases while the short-run aggregate supply decreases.The result is a(n) :
A) increase in both equilibrium real GDP and the price level.
B) decrease in equilibrium real GDP and an increase in the price level.
C) decrease in both equilibrium real GDP and the price level.
D) decrease in equilibrium real GDP, while the price level remains fixed.
E) increase in the price level, while the change in equilibrium real GDP is ambiguous.
Correct Answer:
Verified
Correct Answer:
Verified
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