Multiple Choice
Exhibit 11-5 
-If the economy is at point M in Exhibit 11-5,
A) the actual price level is lower than expected with a $200 billion expansionary gap
B) the actual price level is lower than expected with a $200 billion contractionary gap
C) the actual price level is higher than expected with a $200 billion contractionary gap
D) the actual price level is higher than expected with a $200 billion expansionary gap
E) the economy is in equilibrium in the short run and the long run
Correct Answer:
Verified
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