Consider the graph at right showing the long-run aggregate supply (LAS) and the aggregate demand (AD) curves. Suppose the long-run aggregate supply curve shifts to a real GDP level of $75. O A. The equilibrium price level will fall, and equilibrium real GDP will decrease. B. The equilibrium price level will fall, and equilibrium real GDP will increase. C. The equilibrium price level will rise, and equilibrium real GDP will increase. OD. The equilibrium price level will rise, and equilibrium real GDP will decrease. ----- Price level Po LRAS AD 0 10 20 30 40 50 Real GDP 60 70 80 90 100

Consider the graph at right showing the long-run aggregate supply (LAS) and the aggregate demand (AD) curves. Suppose the long-run aggregate supply curve shifts to a real GDP level of $75. O A. The equilibrium price level will fall, and equilibrium real GDP will decrease. B. The equilibrium price level will fall, and equilibrium real GDP will increase. C. The equilibrium price level will rise, and equilibrium real GDP will increase. OD. The equilibrium price level will rise, and equilibrium real GDP will decrease. ----- Price level Po LRAS AD 0 10 20 30 40 50 Real GDP 60 70 80 90 100

Principles of Economics (MindTap Course List)

8th Edition

ISBN:9781305585126

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter33: Aggregate Demand And Aggregate Supply

Section: Chapter Questions

Problem 4CQQ

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