PRICE LEVEL AD 400 800 1200 OUTPUT minors if audax) In the short run, the increase in foreign spending on domenic goods misociated with expansion abroad counts the price level to price level people expected and the quantity of output to the steel level of output. The communic prosperity street wil cause the mant note to the natural rate of urem ment in the short run. sending long-run coudlibrium at the expected price level of 120 and natural sulpot freed of 1460 billion, prior to the increase in foreign spending mestic goods associated with expansion abroad Along the transition from short run to the long run, price-level expects