Starting from Short-Run Equilibrium,the Following Occurs: Individuals Expect Higher (Future)incomes
Multiple Choice
Starting from short-run equilibrium,the following occurs: individuals expect higher (future) incomes and wage rates rise.What is the effect on the price level and Real GDP in the short run?
A) The price level rises and Real GDP rises.
B) The price level falls and Real GDP falls.
C) The price level rises,but the effect on Real GDP cannot be determined.
D) Real GDP rises,but the effect on the price level cannot be determined.
E) Real GDP falls,but the effect on the price level cannot be determined.
Correct Answer:
Verified
Correct Answer:
Verified
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