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Exhibit 14-5 -Refer to the Graph in the Exhibit.What Does the Graph

Question 5

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Exhibit 14-5
Exhibit 14-5 -Refer to the graph in the exhibit.What does the graph illustrate about the state of the economy?   A)  The economy is in a long-run equilibrium at the price level P and income level Y.  B)  The economy is in a short-run equilibrium at the price level P and income level Y.  C)  The economy is experiencing a recessionary gap at price level P and income level Y.  D)  The economy is in a short-run equilibrium at the price level P′ and income level Y.
-Refer to the graph in the exhibit.What does the graph illustrate about the state of the economy?  


A)  The economy is in a long-run equilibrium at the price level P and income level Y. 
B)  The economy is in a short-run equilibrium at the price level P and income level Y. 
C)  The economy is experiencing a recessionary gap at price level P and income level Y. 
D)  The economy is in a short-run equilibrium at the price level P′ and income level Y.

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