The economy is in its short run equilibrium at the point where the
A) price level is stable.
B) SAS curve intersects the LAS curve.
C) AD curve intersects the LAS curve.
D) AD curve intersects the SAS curve.

Question

Quizplus · Accepted Answer

In the short run, the economy reaches its equilibrium at the point where the Aggregate Demand (AD) curve intersects the Short-Run Aggregate Supply (SAS) curve. This intersection determines the price level and output level in the short run.

The Economy Is in Its Short Run Equilibrium at the Point