FIGURE 24-1 -Refer to Figure 24-1.If the Economy Is Currently Producing Output

Multiple Choice

FIGURE 24-1
-Refer to Figure 24-1.If the economy is currently producing output of Y₀ and wages are sticky downwards,then the

A) economy will eventually move to point B.
B) economy will move only slowly toward point A as wages slowly adjust.
C) economy will quickly move to point A.
D) level of output will decrease below Y₀.
E) AD curve will eventually shift to the right and return the economy to its full-employment level of output.