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If a Decrease in the Z Factors Resulted in a Very

Question 96

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If a decrease in the Z factors resulted in a very large change in the price level and a very small change in aggregate output,


A) then in the U.S. economy investment demand must not be sensitive to the interest rate.
B) then the U.S. economy must have been on the very steep part of its short-run aggregate supply curve.
C) then the U.S. economy must have been on the very flat part of its short-run aggregate supply curve.
D) then the U.S. aggregate demand curve must be very steep.

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