The table gives the aggregate demand schedule, the short-run aggregate supply sc

Question

The table gives the aggregate demand schedule, the short-run aggregate supply schedule, and the long-run aggregate supply schedule for an economy Real GDP Real GDP supplied supplied demanded in short run in long run (billions of 2009 dollars) 200 300 400 500 Real GDP Price level (GDP deflator) 100 105 110 115 What is the quantity of real GDP at the short-run macroeconomic equilibrium? The quantity of real GDP at the short-run macroeconomic equilibrium is $. billion 700 600 500 400 500 500 500 500 The economy h as OA. an inflationary gap of $50 billion O B. a recessionary gap of $50 billion C. neither a recessionary gap nor an inflationary gap O D. an inflationary gap of $450 billion

Explanation / Answer

the quantity of real gdp at the short run equilibrium is 450 billion.

the economy has a recessionary gap of $50 billion.

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