If the economy is experiencing an economic boom, which point in the graph shown would likely represent this?

Question

Quizplus · Accepted Answer

A boom typically corresponds with a period of high economic growth, which is represented by an increase in output and price levels. This is shown in the graph as a shift to the right of the AS curve, resulting in higher equilibrium output and price levels. The point on the graph that corresponds to this is E₄, where both output and price levels are higher than at the other points. Therefore, the correct choice is D.

If the Economy Is Experiencing an Economic Boom, Which Point