How Do Prices Change Due to an Economic Contraction That

question 30

Multiple Choice

How do prices change due to an economic contraction that is caused by a shift in aggregate demand?

• A) They rise in the short run and rise even more in the long run.
• B) They rise in the short run and fall back to their original level in the long run.
• C) They fall in the short run and fall even more in the long run.
• D) They fall in the short run and rise back to their original level in the long run.