The SRAS Is Horizontal at a Price Level of 4

question 80

Multiple Choice

The SRAS is horizontal at a price level of 4.
According to the AD-AS model,the economy depicted above has a(n) ___________ gap equal to ___________ in the short run.In the long run,this output gap will be eliminated through a ___________ in the price level to ___________.

• A) expansionary;50;rise;4
• B) recessionary;50;fall;1
• C) expansionary;50;rise;3
• D) expansionary;100;rise;4
• E) recessionary;100;fall;2

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