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Use the following to answer questions: Use the following to answer questions:   -(Figure: Classical Model of the Price Level)  Refer to Figure: Classical Model of the Price Level. If the central bank increases the money supply such that aggregate demand shifts from AD<sub>1</sub> to AD<sub>2</sub>, according to this classical model, the equilibrium point will: A)  not change. B)  immediately move from E<sub>1</sub> to E<sub>2</sub>. C)  immediately move from E<sub>2</sub> to E<sub>1</sub>. D)  immediately move from E<sub>1</sub> to E<sub>3</sub>.
-(Figure: Classical Model of the Price Level) Refer to Figure: Classical Model of the Price Level. If the central bank increases the money supply such that aggregate demand shifts from AD1 to AD2, according to this classical model, the equilibrium point will:

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Definitions:

Quantity Sold

The total number of units of a product or service that have been purchased by consumers during a specific period.

Lemon Cakes

A type of cake flavored with lemon, often featuring lemon zest or juice in the recipe for a tart flavor.

Revenue

The total income generated from the sale of goods or services before any expenses are subtracted.

Marginal Product

The additional output that is produced by adding one more unit of a specific input, while holding all other inputs constant.

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