Two potential problems with macro equilibrium are
A)Undesirability and instability.
B)The profit effect and the real balance effect.
C)External shocks and policy levers.
D)Multiple shifts to AS and AD.

Question

Quizplus · Accepted Answer

Macro equilibrium can be undesirable if it occurs at a level of output that is below full employment, which means there are unemployed resources in the economy. Additionally, macro equilibrium can be unstable if the economy is operating near a point of inflection on the aggregate demand or supply curve, which can lead to large fluctuations in output and employment in response to small changes in the economy.

Two Potential Problems with Macro Equilibrium Are