Suppose We Are at a Long-Run Equilibrium Point in an AD-AS

question 18

Multiple Choice

Suppose we are at a long-run equilibrium point in an AD-AS model.Then the money supply falls.In the short run,is there any difference between what happens in the simple quantity theory of money (SQTM) version and the monetarist version of the model?

• A) There is no difference.
• B) In the SQTM version,the price level falls; in the monetarist version,it does not.
• C) In the monetarist version,Real GDP falls; in the SQTM version,it does not.
• D) In the monetarist version,the price level falls; in the SQTM version,it does not.
• E) In the SQTM version,Real GDP falls; in the monetarist version,it does not.

---

Definitions:

Legally Divorced

A status that indicates a person has completed the legal process of divorce, thereby dissolving the marital relationship under law.

Full-Time Student

A student who is enrolled in a higher education institution for the number of hours or courses the school considers to be full-time attendance.

Own Support

Refers to the financial contribution made by an individual towards their own living expenses, potentially affecting tax filing status and dependency exemptions.

Exemption

Deductions allowed by law to reduce taxable income based on taxpayer and dependent information.