Exhibit 10-5
-According to the graph in Exhibit 10-5,if the price level decreases,the new equilibrium level of real GDP must be
A) less than $20
B) less than $100
C) unchanged
D) greater than $100
E) greater than $200

Question

Exhibit 10-5 
-According to the graph in Exhibit 10-5,if the price level decreases,the new equilibrium level of real GDP must be
A) less than $20 
B) less than $100 
C) unchanged 
D) greater than $100 
E) greater than $200

Quizplus · Accepted Answer

According to the graph, decreasing the price level will shift the aggregate demand (AD) curve to the right, resulting in a higher equilibrium level of real GDP. The new equilibrium level of real GDP will be greater than $100.

Exhibit 10-5 -According to the Graph in Exhibit 10-5,if the Price Level