When the aggregate demand curve and the short-run aggregate supply curve intersect
A) the long-run aggregate supply curve must also intersect at the same point.
B) structural and frictional unemployment equal zero.
C) inflation must be increasing.
D) the economy is in short-run macroeconomic equilibrium.
D
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An exchange rate can be described as:
a. the price of a foreign currency as determined by the World Bank. b. the price of one country's currency in terms of another country's currency. c. the dollar value of imports and exports undertaken in the world economy during a year. d. the price of foreign currency as established by the relative amount of tourism. e. the dollar value of U.S. international trade.
In case of a backward-bending labor supply curve:
a. the income effect of a higher wage offsets the substitution effect. b. the substitution effect of a higher wage offsets income effect. c. the substitution effect of a higher wage equals income effect. d. there is no income effect at a higher wage rate.