Refer to Figure 13-13. What is the profit maximizing output level?

A recession shows

A) supply always equals demand. B) supply never equals demand. C) thousands of businesspeople have misread market signals. D) real GDP must be lower than nominal GDP. E) not enough households are using their credit cards.

The lon-run aggregate supply curve can be expressed by

A) output as a function of potential output. B) inflation as a function of past inflation. C) inflation as a function of past inflation and output gap. D) output as a function of inflation and output gap.