Beginning from a position of long-run equilibrium, suppose there ...

[Kthamas]

Beginning from a position of long-run equilibrium, suppose there is an increase in the aggregate demand curve. After adjustment and comparing the economy's new long-run equilibrium with its original long-run position, the result would be an increase in:
 a. real GDP.
 b. the price level (CPI).
 c. the unemployment rate.
  d. a and b, but not c.

Question 2

Best National Bank operates with a 20 percent required reserve ratio. One day a depositor withdraws 500 from his or her checking account at this bank. As a result, the bank's excess reserves:
 a. fall by 500 b. fall by 400.
  c. rise by 100 d. rise by 500.

[Laurenleakan]

Answer to Question 1

b

Answer to Question 2

a