In the classical model where aggregate supply is vertical with respect to the price level,an increase (shift)in aggregate demand will yield

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Quizplus · Accepted Answer

In the classical model, where the aggregate supply curve is vertical, an increase in aggregate demand primarily leads to an increase in the price level rather than an increase in output, because the economy is typically considered to be at or near full employment.

In the Classical Model Where Aggregate Supply Is Vertical with Respect