FIGURE 24-1 -Refer to Figure 24-1.If the economy is currently producing output of Y₀,the economy's automatic adjustment process will have the A)AS curve shifting to the right until point A is reached. B)vertical line at Y^* shifting to the left until it gets to Y₀. C)AD curve shifting to the right until point B is reached. D)economy remaining where it is. E)level of potential output falling.

Question

Quizplus · Accepted Answer

The automatic adjustment process will shift the AS curve to the right until point A is reached, where the economy is producing at its potential output level.

FIGURE 24-1 -Refer to Figure 24-1.If the Economy Is Currently Producing Output