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Exhibit 16-2 Macro AD\AS Models in Panel (A)of Exhibit

Question 14

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Exhibit 16-2 Macro AD\AS Models Exhibit 16-2 Macro AD\AS Models In Panel (a) of Exhibit 16-2, suppose that the initial equilibrium is at real GDP level   Y<sub>1</sub> and price level P<sub>2</sub>. At real GDP level Y<sub>1</sub> there is: A) an inflationary gap. B) a recessionary gap. C) full employment. D) long-run equilibrium. In Panel (a) of Exhibit 16-2, suppose that the initial equilibrium is at real GDP level   Y1 and price level P2. At real GDP level Y1 there is:


A) an inflationary gap.
B) a recessionary gap.
C) full employment.
D) long-run equilibrium.

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