If the Economy Is in Short-Run Equilibrium but Not in Long-Run

question 65

Multiple Choice

If the economy is in short-run equilibrium but not in long-run equilibrium, what forces cause the economy to return to long-run equilibrium?

• A)Input prices change, causing the short-run aggregate supply curve to shift.
• B)The long-run aggregate supply curve shifts until long-run equilibrium is restored.
• C)The aggregate demand curve shifts, causing price changes that restore long-run equilibrium.
• D)None of the above is correct.

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Definitions:

Sciatic Nerve

Tibial and common peroneal nerves bound together; also called ischiadic nerve.

Tibial Nerve

A nerve in the lower leg that is a branch of the sciatic nerve, responsible for innervating parts of the lower leg and foot.

Common Fibular Nerve

The common fibular nerve, known also as the common peroneal nerve, is a branch of the sciatic nerve that innervates the lower leg, particularly muscles that control foot eversion and dorsiflexion.

Pudendal

Relating to the pudendal nerve, which supplies the muscles and skin of the perineum, playing a crucial role in the sensory and motor supply to pelvic area structures.