When the economy is operating at a point where aggregate demand equals long-run aggregate supply:
A) the economy is in a recession.
B) the economy is in long-run equilibrium.
C) short-run aggregate supply must shift to the left to adjust.
D) All of these are true

Question

Quizplus · Accepted Answer

When the economy is operating at a point where aggregate demand equals long-run aggregate supply, it means that the economy is in long-run equilibrium. In this state, there is no pressure for short-run aggregate supply to shift and the economy is neither in a recession nor overheating.

When the Economy Is Operating at a Point Where Aggregate