If a drop in aggregate demand causes a recession,then over this range of real output the aggregate supply curve is:

Question

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If a drop in aggregate demand causes a recession, then over this range of real output, the aggregate supply curve is upward sloping. This is because as the demand for goods and services decrease, firms will decrease their output and reduce the prices of their goods and services to remain competitive, and hence the aggregate supply curve will be upward sloping.

If a Drop in Aggregate Demand Causes a Recession,then Over