Use the figure below to answer the following question(s).
Figure 10-7

-Given the aggregate demand and aggregate supply curves for the economy depicted in Figure 10-7,the economy's output and price level are
A)output Y₁ and price level P₁.
B)output Y₂ and price level P₂
C)output Y₁ and price level P₃.
D)output Y₂ and price level P₁.

Question

Use the figure below to answer the following question(s).
Figure 10-7
 
-Given the aggregate demand and aggregate supply curves for the economy depicted in Figure 10-7,the economy's output and price level are
A)output Y₁ and price level P₁. 
B)output Y₂ and price level P₂ 
C)output Y₁ and price level P₃. 
D)output Y₂ and price level P₁.

Quizplus · Accepted Answer

The point where the aggregate demand and aggregate supply curves intersect is the equilibrium point of the economy. In Figure 10-7, the intersection point is at output level Y₂ and price level P₂. Therefore, the correct answer is B, output Y₂ and price level P₂.

Use the Figure Below to Answer the Following Question(s)