-In the Above Figure, If Initial Equilibrium Is at Point

Multiple Choice

-In the above figure, if initial equilibrium is at point A and if there is an unanticipated increase in aggregate demand from AD1 to AD2, then

A) in the short run real output will remain at Y1.
B) in the short run real output will increase above Y1, but in the long run it will return to Y1.
C) in the long run real output will increase above Y1.
D) real output will increase above Y1 in both the short run and in the long run.