If a shift in the AD-curve has no impact on the price level, then
A)the unemployment rate must be extremely low
B)the AD-curve must be vertical
C)the AS-curve must be horizontal
D)the AS-curve must be vertical
E)both A and D

Question

Quizplus · Accepted Answer

The AS-curve must be horizontal for a shift in the AD-curve to have no impact on the price level, indicating a situation of perfect elasticity where output can change without affecting prices.

If a Shift in the AD-Curve Has No Impact on the Price