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Figure 20 shows an aggregate-supply aggregate-demand graph. The Price level is on shown on the vertical axis and the Quantity of Output is shown on
Figure 20 shows an aggregate-supply aggregate-demand graph. The "Price level" is on shown on the vertical axis and the "Quantity of Output" is shown on the horizontal axis. A vertical curve named LRAS intersects an upward sloping AS curve and a downward sloping AD1 curve at one point marked as "a." Another downward sloping AD curve named AD2 is to the left of the AD1 curve and intersects the AS curve at point "b." Refer to Figure 20. Which of the following statements is/are correct? Group of answer choices A movement from point a to point b is accompanied by a rise in unemployment. An expansionary monetary policy or the government's use of fiscal policy could move the economy from point b to point a. If no action is taken by policymakers, the price level will fall even lower as the economy moves from point b to a new long-run equilibrium. All of the above statements are correct
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