An Important Assumption in the AD/AS Macro Model Is That

question 11

Multiple Choice

An important assumption in the AD/AS macro model is that when real GDP is less than potential output,factor prices adjust and the

• A)AS curve shifts to the left fairly rapidly.
• B)AS curve shifts to the right only very slowly.
• C)AS curve shifts to the right very rapidly.
• D)AD curve shifts to the left rapidly.
• E)None of the above - the AS curve remains unchanged.