FIGURE 21-3 -Refer to Figure 21-3.In this demand-determined model of the macro economy,the price level is A)measured by Y_2/0B. B)measured by Y₁Y_2/AB. C)increasing as the economy moves from E₀ to E₁. D)assumed to be constant. E)derived from the slope of the AE function.

Question

Quizplus · Accepted Answer

In a demand-determined model, the price level is typically assumed to be constant, meaning it does not change as the economy moves from one equilibrium to another.

FIGURE 21-3 -Refer to Figure 21-3.In This Demand-Determined Model of the Macro