An economy is at equilibrium output when

Related MCQs

• If the short-run IS–LM equilibrium occurs at a level of income below the natural level of output, then in the long run the price level will , shifting the curve to the right and returning output to the natural level.
• In the IS–LM model under the usual conditions in a closed economy, an increase in government spending increases the interest rate and crowds out:
• When using AD/AS analysis to illustrate changes within an economy, which of the following would NOT need to be considered when looking at changes to economic growth?