[Solved] Assuming That the Economy Is Currently in a Long-Run Equilibrium

Question 41
Multiple Choice

Assuming that the economy is currently in a long-run equilibrium with real GDP equal to Y*,a positive AD shock (with no change in the money supply)will eventually result in

A)no change in the price level.
B)an ongoing inflation in the economy.
C)a lower price level and GDP below its potential level.
D)a higher price level and GDP at its potential level.
E)a lower price level and GDP at its potential level.

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