When the economy is operating on its long-run aggregate supply curve and the government initiates an expansionary fiscal policy,the result is
A) a permanent increase in real national income and a permanent increase in the price level.
B) a temporary increase in real national income and a temporary increase in the price level.
C) a temporary increase in real national income and an increase in the price level,followed by a reduction of real national income to its original level and a further increase in the price level.
D) a temporary increase in real national income and an increase in the price level,followed by a further increase in the price level.
Correct Answer:
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