Exhibit 16-4
-In Exhibit 16-4, short-run equilibrium occurs
A)at point a
B)at point b
C)at point c, where the actual price level exceeds the expected price level
D)at point c, where the actual price level is less than the expected price level
E)at point c, where there is a contractionary gap

Question

Exhibit 16-4 
-In Exhibit 16-4, short-run equilibrium occurs
A)at point a 
B)at point b 
C)at point c, where the actual price level exceeds the expected price level 
D)at point c, where the actual price level is less than the expected price level 
E)at point c, where there is a contractionary gap

Quizplus · Accepted Answer

In short-run equilibrium, the actual price level can exceed the expected price level, which is typically represented by point c in economic models.

Exhibit 16-4 -In Exhibit 16-4, Short-Run Equilibrium Occurs