-The Data in the Above Table Indicate That When the |

question 39

Multiple Choice

$$\begin{array} { | l | l | l | l | } \hline \begin{array} { l } \text { Price } \\\text { level }\end{array} & \begin{array} { l } \text { A ggregate } \\\text { demand } \\\text { (trillions of } \\\text { 2005 dollars) }\end{array} & \begin{array} { l } \text { Short-run } \\\text { aggregate } \\\text { supply } \\\text { (trillions of } \\\text { 2005 dollars) }\end{array} & \begin{array} { l } \text { Long-run } \\\text { aggregate } \\\text { supply } \\\text { (trillions of } \\\text { 2005 dollars) }\end{array} \\\hline 130 & 8 & 12 & 10 \\\hline 120 & 9 & 11 & 10 \\\hline 110 & 10 & 10 & 10 \\\hline 100 & 11 & 9 & 10 \\\hline 90 & 12 & 8 & 10 \\\hline\end{array}$$
-The data in the above table indicate that when the price level is 100,

• A) inventories are at levels planned by firms.
• B) firms will plan to decrease the level of output.
• C) firms have unexpectedly high inventories, so prices fall.
• D) firms have unexpectedly low inventories, so prices will rise.

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