An Important Limitation of the AD-AS Model Is That It

Multiple Choice

An important limitation of the AD-AS model is that it predicts that a collapse in oil prices would result in a fall in the general price level.But the experience of many countries in the late 1980s clearly demonstrated that,when oil prices fall,the overall price level keeps ___________ but at a ___________ pace.That is,the ___________ falls,but not the price level.

A) rising;slower;inflation rate
B) rising;faster;inflation rate
C) falling;slower;inflation rate
D) rising;slower;unemployment rate
E) falling;faster;inflation rate