Use the Aggregate Supply/aggregate Demand Model in Figure 13

question 5

Multiple Choice

Use the aggregate supply/aggregate demand model in Figure 13.4 to answer the following scenario. The United Auto Workers were able to negotiate a contract for higher wages and better benefits. The economy initially moves from point ________ to point ________; eventually the economy returns to the steady state at point ________.

• A) c; d; a
• B) a; d; a
• C) c; a; b
• D) b; a; c
• E) Not enough information is given.

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