-In the above figure, the aggregate demand curve is AD₂, so the long-run equilibrium level of real GDP is A) $18 trillion. B) $18.5 trillion. C) more than $18 and less than $18.5 trillion. D) None of the above answers is correct.

Question

Quizplus · Accepted Answer

The long-run equilibrium level of real GDP is determined where the aggregate demand curve intersects the long-run aggregate supply curve. If AD₂ intersects the long-run aggregate supply at $18 trillion, then that is the long-run equilibrium level of real GDP.

-In the Above Figure, the Aggregate Demand Curve Is AD2

-In the Above Figure, the Aggregate Demand Curve Is AD₂