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  3. Study Set
    Principles of Macroeconomics Study Set 12
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    Exam 11: The Determination of Aggregate Output, the Price Level, and the Interest Rate
  5. Question
    The Real Wealth Effect Explains Why the Aggregate Supply Curve
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The Real Wealth Effect Explains Why the Aggregate Supply Curve

Question 25

Question 25

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The real wealth effect explains why the aggregate supply curve is horizontal in the long run.

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