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Exhibit 16-5 -If the Economy Pictured in Exhibit 16-5 Is in Equilibrium

Question 73

Multiple Choice

Exhibit 16-5 Exhibit 16-5 -If the economy pictured in Exhibit 16-5 is in equilibrium where AD = SRAS, then it A) is experiencing a contractionary gap B) will experience an increase in the price level if no government action is taken C) is operating at the potential level of output D) will experience a stable price level if no government action is taken E) is operating at less than the economy's potential level of output
-If the economy pictured in Exhibit 16-5 is in equilibrium where AD = SRAS, then it


A) is experiencing a contractionary gap
B) will experience an increase in the price level if no government action is taken
C) is operating at the potential level of output
D) will experience a stable price level if no government action is taken
E) is operating at less than the economy's potential level of output

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