Figure 14.1
-Suppose the economy is at point A in Figure 14.1.If consumer spending increases in the economy,where will the eventual long-run equilibrium be?

Question

Figure 14.1 
-Suppose the economy is at point A in Figure 14.1.If consumer spending increases in the economy,where will the eventual long-run equilibrium be?

Quizplus · Accepted Answer

In the long run, an increase in consumer spending will shift the aggregate demand curve to the right, moving the economy to a new equilibrium at a higher output level, typically represented by Point C.

Figure 14.1 -Suppose the Economy Is at Point a in Figure 14.1.If