Question: Given your knowledge of how aggregate supply changes from the very short run to the long run, what is the LONG-RUN impact of a decrease
Given your knowledge of how aggregate supply changes from the very short run to the long run, what is the LONG-RUN impact of a decrease in aggregate demand? a. There is a slow fall in prices as the short-run aggregate supply begins to have a positive slope, and the initial decline in output will increase. b. There is a recession as output falls sharply, and prices will not have had time to adjust. c. There is a sharp fall in prices in the economy as business hurriedly lower prices to try to boost sales. d. All prices adjust, and the economy returns to long-run potential
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