Suppose that the graph below represents the aggregate demand (AD) and aggregate supply (AS) of Guadeloupe. What will happen to Guadeloupe's economy in the long-run, according to the neoclassical view? Potential GDP Price Level AS AD Real GDP Guadeloupe's aggregate supply (AS) will shift to the left. Guadeloupe's potential GDP line will shift to the right. Guadeloupe's aggregate supply (AS) will shift to the right. Guadeloupe's aggregate demand (AD) will shift to the left.
Suppose that the graph below represents the aggregate demand (AD) and aggregate supply (AS) of Guadeloupe. What will happen to Guadeloupe's economy in the long-run, according to the neoclassical view? Potential GDP Price Level AS AD Real GDP Guadeloupe's aggregate supply (AS) will shift to the left. Guadeloupe's potential GDP line will shift to the right. Guadeloupe's aggregate supply (AS) will shift to the right. Guadeloupe's aggregate demand (AD) will shift to the left.
Chapter10: Kenesian Macroeconomics And Economic Instability: A Critique Of The Self Regulating Economy
Section: Chapter Questions
Problem 3WNG
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![Suppose that the graph below represents the aggregate demand (AD) and aggregate supply (AS) of
Guadeloupe. What will happen to Guadeloupe's economy in the long-run, according to the neoclassical
view?
Potential GDP
OO
Price Level
AS
AD
Real GDP
Guadeloupe's aggregate supply (AS) will shift to the left.
Guadeloupe's potential GDP line will shift to the right.
Guadeloupe's aggregate supply (AS) will shift to the right.
Guadeloupe's aggregate demand (AD) will shift to the left.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fdbe85a92-3da7-404f-b729-852776999327%2F115ededb-dcaa-490a-9d63-c5c7b8bca436%2Fwz0kmd_processed.png&w=3840&q=75)
Transcribed Image Text:Suppose that the graph below represents the aggregate demand (AD) and aggregate supply (AS) of
Guadeloupe. What will happen to Guadeloupe's economy in the long-run, according to the neoclassical
view?
Potential GDP
OO
Price Level
AS
AD
Real GDP
Guadeloupe's aggregate supply (AS) will shift to the left.
Guadeloupe's potential GDP line will shift to the right.
Guadeloupe's aggregate supply (AS) will shift to the right.
Guadeloupe's aggregate demand (AD) will shift to the left.
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