In the Given Figure, the Economy Is Initially in Long-Run

question 147

Multiple Choice

In the given figure, the economy is initially in long-run equilibrium at point A. If there is an adverse supply shock that reduces potential output and shifts the long-run aggregate supply curve from LRAS to LRAS', then the new long-run equilibrium is reached at point:

• A)E.
• B)B.
• C)C.
• D)D.

---

Definitions:

Majority Opinion

The judicial opinion agreed upon by more than half of the members of a court that represents the reasoning behind the court's decision.

Basis

The underlying support or foundation for an idea, argument, or process; in financial contexts, it refers to the value ascribed to an asset for tax purposes.

Constitutional Sources

Documents or texts that serve as the foundation or basis for a country's constitution and its principles.

United States Constitution

The supreme law of the United States of America, establishing the national government, fundamental principles, and rights of citizens.