The AD-AS model predicts that a positive AD shock will cause the price level to ___________,from the initial to a new long-run equilibrium level.But the model is silent about how fast the price level will ___________ from the initial to the new level;the model cannot explain ___________.
A) increase;increase;the inflation rate
B) increase;increase;the price level
C) decrease;decrease;the inflation rate
D) increase;increase;stagflation
E) decrease;decrease;the price level
Correct Answer:
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A) horizontal.
B) vertical.
C)
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