In the Accompanying Graphs, Q $$Q _ { P }$$ Refers to the Economy's Potential Output Level

question 149

Multiple Choice

In the accompanying graphs, Q $$Q _ { P }$$ refers to the economy's potential output level. Graph A is
Constructed on the basic assumption that

• A) the price level is not ?exible.
• B) nominal wages are unresponsive to price-level changes.
• C) real output is unresponsive to price-level changes.
• D) unemployment is unresponsive to price-level changes.