Top Posters
Since Sunday
w
3
w
3
e
3
3
r
3
b
2
M
2
V
2
f
2
c
2
c
2
K
2
Home Q & A Board Other Fields Homework Help Business Economics
New Topic  
Mandolina Mandolina
wrote...
Go to Answer
Posts: 1228
Rep: 0 0
7 years ago
Assume that the economy is initially in equilibrium at a price level of 100 and a potential GDP of $1,000 billion. If aggregate demand falls,
A) the price level will initially decline but will return to 100 when the self-correcting mechanism restores potential GDP.
B) the price level will initially rise but will return to 100 when the self-correcting mechanism restores potential GDP.
C) the price level will initially decline but will fall even further when the self-correcting mechanism restores potential GDP.
D) the price level will initially increase but will rise even further when the self-correcting mechanism restores potential GDP.
E) the price level will initially decline but will rise above 100 when the self-correcting mechanism restores potential GDP.
Textbook 
Introduction to Economic Reasoning

Introduction to Economic Reasoning


Edition: 8th
Author:
Read 102 times
2 Replies
Replies
Answer verified by a subject expert
foliogefolioge
wrote...
#1
Top Poster
Posts: 604
Rep: 5 0
7 years ago
Sign in or Sign up in seconds to unlock everything for free
More solutions for this book are available here
1

Related Topics

Mandolina Author
wrote...
#2
7 years ago
Makes a ton of sense now Smiling Face with Open Mouth
New Topic      
Quick Reply
Explore
Post your homework questions and get free online help from our incredible volunteers
  435 People Browsing
Start New Topic Take the Tour CoursesNew Study Tools Topics Trending Browse by Textbook
Live Chat
Related Images
  
 290
  
 15223
  
 446
Your Opinion
Which 'study break' activity do you find most distracting?
Votes: 824
Previous poll results: Should Ph.D.'s be addressed as doctors?