The long-run aggregate supply curve shows that by itself a permanent change in aggregate demand would lead to a long-run change
A)in the price level and output.
B)in the price level,but not output.
C)in output,but not the price level.
D)in neither the price level nor output.

Question

Quizplus · Accepted Answer

The long-run aggregate supply curve is vertical, indicating that in the long run, changes in aggregate demand only affects the price level, not the level of output. Therefore, a permanent change in aggregate demand would lead to a long-run change in the price level, but not output.

The Long-Run Aggregate Supply Curve Shows That by Itself a Permanent