-In the Above Figure, the Economy Initially Is at Point

question 98

Multiple Choice

-In the above figure, the economy initially is at point A and then an increase in the quantity of money moves the economy to point D. If the quantity of money remains constant, the economy will adjust with

• A) aggregate demand shifting back to AD₀.
• B) aggregate demand shifting to AD₂.
• C) short-run aggregate supply shifting leftward to SAS₂.
• D) short-run aggregate supply shifting leftward to SAS₁.

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