Exhibit 10-2 -If the actual price level in Exhibit 10-2 exceeds the expected price level,then A)equilibrium output is Y₂ in the short run B)equilibrium output is Y₁ in the short run C)the actual unemployment rate is below the natural rate D)potential output is greater than actual output E)the actual price level is less than the equilibrium price level

Question

Quizplus · Accepted Answer

When the actual price level exceeds the expected price level, firms produce more than the potential output, leading to an actual unemployment rate below the natural rate.

Exhibit 10-2 -If the Actual Price Level in Exhibit 10-2 Exceeds the 10-2