Consider the AD/AS Model

question 98

Multiple Choice

Consider the AD/AS model.Since output in the long run is determined by Y^*,the only role of the AD curve is to determine the price level.This is true because

• A)Y^* is independent of the price level.
• B)the aggregate demand curve is vertical.
• C)the aggregate demand curve is horizontal.
• D)Y^* depends on the price level.
• E)the AS curve is upward sloping.

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Definitions:

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