-Refer to Figure 11-7

Multiple Choice

-Refer to Figure 11-7.If the economy is currently producing at point X,what does the short-run macro model predict will happen?

A) Nothing will happen;the economy is in equilibrium.
B) Prices will rise and firms will increase production.
C) Prices will fall and firms will increase production.
D) Inventories will shrink and firms will increase production.
E) Inventories will accumulate and firms will cut production.