Which of the Following Is Not an Assumption Made by the Dynamic

question 14

Multiple Choice

Which of the following is not an assumption made by the dynamic model of aggregate demand and aggregate supply?

• A)Potential GDP increases continuously.
• B)Aggregate demand shifts to the right during most periods.
• C)Aggregate supply shifts to the right except during periods when workers and firms expect higher wages.
• D)Aggregate demand and potential GDP decrease continuously.

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