Question 1
Refer to the information provided in Figure 26.7 below to answer the question(s) that follow.
Refer to Figure 26.7. The level of aggregate output that can be sustained in the long run without inflation
◦ is $800 million.
◦ is $700 million.
◦ is $400 million.
◦ cannot be determined from this information because aggregate demand is not given.
Question 2
Refer to the information provided in Figure 26.7 below to answer the question(s) that follow.
Refer to Figure 26.7. $700 million is the level of aggregate output that can be sustained in the long run
◦ without inflation.
◦ only with inflation.
◦ only with deflation.
◦ only with unemployment.
Answer
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