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Question
In the above figure, if initial equilibrium is at point A and if there is an unanticipated increase in aggregate demand from AD 1 to AD2, then
A) in the short run real output will remain at Y1.
B) in the short run real output will increase above Y1, but in the long run it will return to Y 1.
C) in the long run real output will increase above Y1.
D) real output will increase above Y1 in both the short run and in the long run.
Answer
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Related questions
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