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At Long-Run Equilibrium in the Dynamic Model of Aggregate Demand ε\varepsilon

Question 39

Multiple Choice

At long-run equilibrium in the dynamic model of aggregate demand and aggregate supply, the demand and supply shocks, ε\varepsilon t and ν\nu t, equal _____ and current inflation, π\pi t, equals _____.


A) 0; 0
B) 0; π\pi t - 1
C) π\pi t; 0
D) πt\pi _ { \mathrm { t } } ^ { \mathrm { * } } ρ\rho

Correct Answer:

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