Figure 14-6

-In Figure 14-7,short-run equilibrium occurs
A)at point a.
B)at point b.
C)at point c,where the actual price level exceeds the expected price level.
D)at point c,where the actual price level is less than the expected price level.

Question

Figure 14-6
 
-In Figure 14-7,short-run equilibrium occurs
A)at point a. 
B)at point b. 
C)at point c,where the actual price level exceeds the expected price level. 
D)at point c,where the actual price level is less than the expected price level.

Quizplus · Accepted Answer

In short-run equilibrium, the actual price level can exceed the expected price level, leading to an output level different from the natural level of output.

Figure 14-6 -In Figure 14-7,short-Run Equilibrium Occurs