The following are aggregate demand and supply schedules for a hypothetical economy.All figures are in $ billions.
Note: Potential GDP is 3,000.
-Refer to the information above to answer this question.Assume that technological change increases aggregate supply by 340.What would be the result?
A)A new full employment level of Real GDP of 3,340 and lower prices.
B)An inflationary gap of 340.
C)A recessionary gap of 240.
D)A new equilibrium of Real GDP of some indeterminate level depending on how much prices fell.
E)A new full-employment level of Real GDP of 3,340 with no change in prices.

Question

The following are aggregate demand and supply schedules for a hypothetical economy.All figures are in $ billions.
  Note: Potential GDP is 3,000.
-Refer to the information above to answer this question.Assume that technological change increases aggregate supply by 340.What would be the result?
A)A new full employment level of Real GDP of 3,340 and lower prices. 
B)An inflationary gap of 340. 
C)A recessionary gap of 240. 
D)A new equilibrium of Real GDP of some indeterminate level depending on how much prices fell. 
E)A new full-employment level of Real GDP of 3,340 with no change in prices.

Quizplus · Accepted Answer

The Answer of The following are aggregate demand and supply schedules for a hypothetical economy.All figures are in $ billions.
  Note: Potential GDP is 3,000.
-Refer to the information above to answer this question.Assume that technological change increases aggregate supply by 340.What would be the result?
A)A new full employment level of Real GDP of 3,340 and lower prices. 
B)An inflationary gap of 340. 
C)A recessionary gap of 240. 
D)A new equilibrium of Real GDP of some indeterminate level depending on how much prices fell. 
E)A new full-employment level of Real GDP of 3,340 with no change in prices.

The Following Are Aggregate Demand and Supply Schedules for a Hypothetical