The country of Epsilon has continuous strong economic growth and a steady price level. This situation is most likely the result of aggregate demand growing ________ aggregate supply.
A) at the same pace as long-run
B) slower than long-run
C) slower than short-run
D) faster than long-run

Question

Quizplus · Accepted Answer

When aggregate demand grows at the same pace as long-run aggregate supply, it leads to strong economic growth without causing inflation, which matches the scenario described for the country of Epsilon.

The Country of Epsilon Has Continuous Strong Economic Growth and a Steady