Suppose the economy is at point A in Figure 15.1.If consumer spending increases in the economy,where will the eventual long-run equilibrium be?
A) A
B) B
C) C
D) D

Question

Quizplus · Accepted Answer

In the long run, an increase in consumer spending will shift the aggregate demand curve to the right, moving the economy to a new equilibrium point, typically at a higher output and price level, such as point C.

Suppose the Economy Is at Point a in Figure 15