Figure 27-6
-Refer to Figure 27-6. In the dynamic model of AD-AS in the figure above, if the economy is at point A in year 1 and is expected to go to point B in year 2, and no fiscal or monetary policy is pursued, then at point B
A) the unemployment rate is very low.
B) firms are operating at below capacity.
C) the economy is below full employment.
D) income and profits are falling.
E) there is pressure on wages and prices to fall.

Question

Figure 27-6 
-Refer to Figure 27-6. In the dynamic model of AD-AS in the figure above, if the economy is at point A in year 1 and is expected to go to point B in year 2, and no fiscal or monetary policy is pursued, then at point B
A) the unemployment rate is very low. 
B) firms are operating at below capacity. 
C) the economy is below full employment. 
D) income and profits are falling. 
E) there is pressure on wages and prices to fall.

Quizplus · Accepted Answer

The Answer of Figure 27-6 
-Refer to Figure 27-6. In the dynamic model of AD-AS in the figure above, if the economy is at point A in year 1 and is expected to go to point B in year 2, and no fiscal or monetary policy is pursued, then at point B
A) the unemployment rate is very low. 
B) firms are operating at below capacity. 
C) the economy is below full employment. 
D) income and profits are falling. 
E) there is pressure on wages and prices to fall.

Figure 27-6 -Refer to Figure 27-6. in the Dynamic Model of AD-AS