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Exhibit 10A-6 Aggregate Demand and Supply Model

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Exhibit 10A-6 Aggregate demand and supply model

Exhibit 10A-6 Aggregate demand and supply model ​   ​ Beginning from a point of short-run equilibrium at point E<sub>2</sub> in Exhibit 10A-6, the economy's movement to a new position of long-run equilibrium from that point would best be described as: A)  ​a movement along the AD<sub> 2 </sub> curve caused by a shift in the SRAS<sub> 1 </sub> curve to SRAS<sub> 2 </sub>. B)   a movement along the SRAS<sub> 2 </sub> curve with a shift in the AD<sub> 2 </sub> curve. C)  ​a shift in the LRAS curve to an intersection at E<sub> 3 </sub>. D)  ​ no shift of any kind.
​ Beginning from a point of short-run equilibrium at point E2 in Exhibit 10A-6, the economy's movement to a new position of long-run equilibrium from that point would best be described as:

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Definitions:

Budget Constraint

The limitation on the consumption of goods and services imposed by a consumer's income and the prices of those goods and services.

Income

The total amount of money received by an individual or group over a specific time period, coming from various sources like wages, investments, or government assistance.

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Edible fruits produced by an apple tree, characterized by their sweet taste and crisp texture, consumed worldwide.

Bananas

Edible fruits from plants of the genus Musa, commonly enjoyed worldwide and known for their nutritional value.

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