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Scenario 33-2 Imagine That in the Current Year the Economy Is in Is

Question 172

Multiple Choice

Scenario 33-2
Imagine that in the current year the economy is in long-run equilibrium. Then stock prices rise more than expected and stay high for some time.
-Refer to Scenario 33-2. In the short run what happens to the price level and real GDP?


A) Both the price level and real GDP rise.
B) Both the price level and real GDP fall.
C) The price level rises and real GDP falls.
D) The price level falls and real GDP rises.

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