The Table Gives the Aggregate Demand and Aggregate Supply Schedules

question 63

Multiple Choice

The table gives the aggregate demand and aggregate supply schedules for a nation.
-The table above gives data for the nation of Pearl, a small island in the South Pacific. If aggregate demand increases so that the quantity of real GDP demanded is $6 billion more at each price level, the new equilibrium real GDP is ________, and the nation is now experiencing a(n) ________.

• A) $22 billion; recessionary gap
• B) $28 billion; recessionary gap
• C) $28 billion; inflationary gap
• D) $25 billion; equilibrium
• E) $22 billion; inflationary gap

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