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Suppose the economy begins with an equilibrium A. Suppose the input price goes down. Eventually, the economy ends up with an equilibrium B. What of
Suppose the economy begins with an equilibrium A. Suppose the input price goes down.
Eventually, the economy ends up with an equilibrium B.
What of the following statement is correct?
The general price level is higher in A than in B.
The general price level is lower in A than in B.
The general price level is the same in A and in B.
It is ambiguous to conclude whether the general price is higher in A or in B.
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