Use the figure below to answer the following question(s).
Figure 10-6

-Given the aggregate demand and aggregate supply curves for the economy depicted in Figure 10-6,the economy's current output and price level are
A)output Y₁ and price level P₂.
B)output Y₂ and price level P₁.
C)output Y₁ and price level P₃.
D)output Y₂ and price level P₃.

Question

Use the figure below to answer the following question(s).
Figure 10-6
 
-Given the aggregate demand and aggregate supply curves for the economy depicted in Figure 10-6,the economy's current output and price level are
A)output Y₁ and price level P₂. 
B)output Y₂ and price level P₁. 
C)output Y₁ and price level P₃. 
D)output Y₂ and price level P₃.

Quizplus · Accepted Answer

The point where aggregate demand and short-run aggregate supply curves intersect is the equilibrium point for output and price level. In this case, the intersection point is at Y₁ and P₂, therefore the economy's current output and price level are Y₁ and P₂.

Use the Figure Below to Answer the Following Question(s)