Figure 15-3 -In Figure 15-3,if the Economy Is Initially at Equilibrium at at Equilibrium

question 40

Multiple Choice

Figure 15-3
-In Figure 15-3,if the economy is initially at equilibrium at point A,an unanticipated reduction in aggregate demand from A D₁ to A D₂ would cause,in the short run,

• A)the price level to fall from P₁ to P₂,real GDP to fall from Q₁ to Q₂,and the rate of unemployment to increase.
• B)the price level to move from P₁ to P₂,but real GDP would stay at Q₁.
• C)the price level to fall by some amount less than P₁ but greater than P₂,and the rate of unemployment would decrease.
• D)no change in either the price level or real GDP,but a decrease in unemployment.

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