PRICE LEVEL 200 180 160 140 120 100 80 60 40 20 0 + AD 0 1 Step 2: Two PPFs Real GDP and Natural Real GDP SRAS 2 LRAS 3 4 5 6 7 REAL GDP (Trillions of dollars) The short-run equilibrium output level is $7 trillion 8 9 10 , and the economy is operating exists in the labor market of this economy. at a long-run equilibrium with a recessionary gap . As a result,
PRICE LEVEL 200 180 160 140 120 100 80 60 40 20 0 + AD 0 1 Step 2: Two PPFs Real GDP and Natural Real GDP SRAS 2 LRAS 3 4 5 6 7 REAL GDP (Trillions of dollars) The short-run equilibrium output level is $7 trillion 8 9 10 , and the economy is operating exists in the labor market of this economy. at a long-run equilibrium with a recessionary gap . As a result,
Chapter11: Managing Aggregate Demand: Fiscal Policy
Section: Chapter Questions
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