The Figure Below Shows Short-Run Equilibrium in an Aggregate Demand-Aggregate

question 87

Multiple Choice

The figure below shows short-run equilibrium in an aggregate demand-aggregate supply model.If the economy is currently producing Y1 level of output,long-run equilibrium will be established if:

• A)the short-run aggregate supply curve shifts to the right to remove the expansionary gap.
• B)the short-run aggregate supply curve shifts to the left to remove the expansionary gap.
• C)the short-run aggregate supply curve shifts to the left to remove the recessionary gap.
• D)the short-run aggregate supply curve shifts to the right to remove the recessionary gap.
• E)there is a leftward shift of the aggregate demand curve.

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Unadjusted Trial Balance

A financial statement listing all the accounts and their balances before any adjustments are made, used for internal purposes to check the balance of debits and credits.

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