Long-Run Equilibrium Occurs Where

question 4

Multiple Choice

Long-run equilibrium occurs where:

• A)real output is greater than potential output.
• B)the vertical long-run aggregate supply curve, and short-run aggregate supply curve intersect.
• C)the aggregate demand curve, and short-run aggregate supply curve intersect
• D)the aggregate demand curve, vertical long-run aggregate supply curve, and short-run aggregate supply curve all intersect.

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Definitions:

Substitute in Production

A good or service that can be used in place of another in the production process, offering flexibility to producers in their inputs.

Demand for

The volume of a good or service that individuals are prepared and financially capable of buying across a range of prices throughout a certain period.

Supply of Wheat

Refers to the total quantity of wheat that producers are willing and able to sell at different price levels in a given period.

Technology Used

The application of scientific knowledge, tools, and equipment to improve products, processes, and services.