If the Economy Is in Equilibrium at the $400 Billion

question 220

Multiple Choice

If the economy is in equilibrium at the $400 billion level of GDP and the full-employment level of GDP is $500 billion:

• A)real and nominal GDP will both increase.
• B)economy does not reach full-employment unless aggregate expenditures increases.
• C)real GDP will increase, but nominal GDP will decrease.
• D)the price level will increase.

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