Consider an Economy Initially at Long-Run Equilibrium with Output (Y)equal

question 59

Multiple Choice

Consider an economy initially at long-run equilibrium with output (Y) equal to potential output (Y*) .If the SRAS is positively sloped,then a shift to the right of the AD curve will lead to ___________ in the price level,in the short run.In the long run,the SRAS curve will shift to the ___________ and the equilibrium will be at __________.

• A) an increase;left;Y = Y*
• B) a decrease;right;Y > Y*
• C) no change;left;Y = Y*
• D) an increase;right;Y = Y*
• E) a decrease;left;Y > Y*