If equilibrium real output rises and the equilibrium price level falls,this would likely be due to a:

Question

Quizplus · Accepted Answer

If equilibrium real output rises and the equilibrium price level falls, it indicates that the aggregate supply curve has shifted to the right. The rightward shift of the aggregate supply curve means that the economy can produce more goods and services at lower costs without putting upward pressure on the price level. As a result, real output increases, and the price level decreases. Thus, option C is the correct choice.

If Equilibrium Real Output Rises and the Equilibrium Price Level