Long-run macroeconomic equilibrium occurs when
A) the aggregate demand curve intersects the short-run aggregate supply curve.
B) the aggregate demand and short-run aggregate supply curves intersect at a point on the long-run aggregate supply curve.
C) structural and frictional unemployment equal zero.
D) output is above potential GDP.
Answer: B
Economics
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In the four-part diagram used to construct the IS curve, the upper right-hand graph depicts
A) the IS curve. B) the relationship between the interest rate and autonomous planned spending. C) determination of real income by the saving function and the demand for autonomous planned spending function. D) none of the above.
Economics