The figure below shows equilibrium in an aggregate demand-aggregate supply model.Which of these situations will be experienced by the economy as it moves from point e to point e'?
Figure 10.3

A)An expansionary gap
B)A decline in potential GDP
C)Overutilization of resources
D)Deflation
E)Cost-push inflation

Question

The figure below shows equilibrium in an aggregate demand-aggregate supply model.Which of these situations will be experienced by the economy as it moves from point e to point e'?​ ​
Figure 10.3

A)An expansionary gap 
B)A decline in potential GDP​ 
C)Overutilization of resources​ 
D)Deflation​ 
E)Cost-push inflation​

Quizplus · Accepted Answer

The Answer of The figure below shows equilibrium in an aggregate demand-aggregate supply model.Which of these situations will be experienced by the economy as it moves from point e to point e'?​ ​
Figure 10.3

A)An expansionary gap 
B)A decline in potential GDP​ 
C)Overutilization of resources​ 
D)Deflation​ 
E)Cost-push inflation​

The Figure Below Shows Equilibrium in an Aggregate Demand-Aggregate Supply