-Refer to Exhibit 16-2.Suppose the economy starts at point A.The AD curve shifts from AD₁ to AD₂ and the public perfectly anticipates this.Under new Keynesian macroeconomic assumptions,the most likely short-run equilibrium point will be

Question

-Refer to Exhibit 16-2.Suppose the economy starts at point A.The AD curve shifts from AD<sub>1</sub> to AD<sub>2</sub> and the public perfectly anticipates this.Under new Keynesian macroeconomic assumptions,the most likely short-run equilibrium point will be A) point B. B) point E. C) somewhere on the line between point D and point B. D) somewhere on the line between point E and point B.

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The Answer of -Refer to Exhibit 16-2.Suppose the economy starts at point A.The AD curve shifts from AD₁ to AD₂ and the public perfectly anticipates this.Under new Keynesian macroeconomic assumptions,the most likely short-run equilibrium point will be