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According to Keynesian theory, if equilibrium real GDP is below the full-employment level, then an increase in aggregate demand will result in which of the following changes in equilibrium?
A) Real GDP will rise, but the price level will remain constant.
B) Real GDP and the price level will both rise.
C) Real GDP will remain unchanged but the price level will rise.
D) None of the answers above are correct.
A) Real GDP will rise, but the price level will remain constant.
B) Real GDP and the price level will both rise.
C) Real GDP will remain unchanged but the price level will rise.
D) None of the answers above are correct.
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In Keynesian theory equilibrium output c...
Economics for Today 9th Edition by Irvin Tucker
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