Figure 17-2

-Given the situation in graph (1) in Figure 17-2, what movement would be expected in graph (2) from the economy's self-correcting mechanism?

Question

Figure 17-2
 
-Given the situation in graph (1) in Figure 17-2, what movement would be expected in graph (2) from the economy's self-correcting mechanism?

Quizplus · Accepted Answer

The self-correcting mechanism in an economy typically involves moving from a short-run equilibrium to a long-run equilibrium. In this context, the movement from C to E suggests a return to long-run equilibrium as the economy adjusts itself.

Figure 17-2 -Given the Situation in Graph (1) in Figure 17-2, What