Figure 33-5.
-Refer to Figure 33-5.In Figure 33-5,
A)Point B represents a short-run equilibrium and a long-run equilibrium.
B)Point B represents a short-run equilibrium,and Point A represents a long-run equilibrium.
C)Point B represents a long-run equilibrium,and Point A represents a short-run equilibrium.
D)Point B represents a long-run equilibrium,and Point C represents a short-run equilibrium.

Question

Figure 33-5. 
-Refer to Figure 33-5.In Figure 33-5,
A)Point B represents a short-run equilibrium and a long-run equilibrium. 
B)Point B represents a short-run equilibrium,and Point A represents a long-run equilibrium. 
C)Point B represents a long-run equilibrium,and Point A represents a short-run equilibrium. 
D)Point B represents a long-run equilibrium,and Point C represents a short-run equilibrium.

Quizplus · Accepted Answer

Point B represents a short-run equilibrium where the aggregate demand and short-run aggregate supply intersect, determining the current level of real GDP and price level. However, Point B is not a long-run equilibrium as the economy is experiencing inflationary pressure due to the high price level. Point A represents a long-run equilibrium where the aggregate demand intersects with the long-run aggregate supply, determining the potential output level of real GDP in the long run. Therefore, Point B represents a short-run equilibrium, and Point A represents a long-run equilibrium.

Figure 33-5. -Refer to Figure 33-5.In Figure 33-5