Multiple Choice
-Refer to Exhibit 9-6.If the economy is self-regulating and currently at point 1,what is going to happen?
A) Wages rise,the SRAS curve shifts to the right until it passes through point 3; in long-run equilibrium the price level is lower and Real GDP is higher than at point 1.
B) Wages fall,the SRAS curve shifts to the left until it passes through point 2; in long-run equilibrium the price level is higher and Real GDP is lower that at point 1.
C) Wages fall,the SRAS curve shifts to the right until it passes through point 3; in long-run equilibrium the price level is lower and Real GDP is higher than at point 1.
D) Wages rise,the AD curve shifts to the right until it passes through point 4; in long-run equilibrium the price level and Real GDP are higher than at point 1.
E) Prices rise,the AD curve shifts to the right until it passes through point 4; in long-run equilibrium the price level and Real GDP are higher than at point 1.
Correct Answer:
Verified
Correct Answer:
Verified
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