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const2013 [10]
3 years ago
10

Suppose the economy starts off producing Natural Real GDP. Next, aggregate demand rises, ceteris paribus. As a result, the price

level rises in the short run. In the long run, when the economy has moved back to producing Natural Real GDP, the price level will be-
(A) higher than it was in short-run equilibrium.

(B) lower than it was in short-run equilibrium but higher than it was originally (before aggregate demand increased).

(C) lower than it was originally (before aggregate demand increased).

(D) equal to what it was originally (before aggregate demand increased).
Business
1 answer:
julsineya [31]3 years ago
5 0

Answer:

The answer is (A) higher than it was in short-run equilibrium.

Explanation:

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