Refer to the Graph $A D _ { 1 }$ Intersects A

question 181

Multiple Choice

Refer to the graph. Assume that the economy is in initial equilibrium where AD $A D _ { 1 }$ intersects A
$A S _ {1 }$ . If
There is a decrease in aggregate demand to AD
$A D _ { 2 }$ , then, according to mainstream economists, if
Prices are ?exible and wages are not, this will result in an equilibrium at point

• A) B.
• B) C.
• C) D.
• D) E.