Figure 15-1
In , AD1 and SRAS1 indicate initial conditions in the goods and services market. In the short run, which of the following will most likely result from a shift to a more expansionary monetary policy under the adaptive expectations hypothesis?
a.
price level P1 and output Y1
b.
price level P2 and output Y2
c.
price level P3 and output Y1
d.
price level P1 and output Y2
b
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