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AP® Macroeconomics

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Positive Expectations and the AD/AS Model

APMACR-IRSSNY

People in Country X expect the economy to improve because the last few jobs reports have been positive.

How would this affect the AD/AS model in the short run?

A

Aggregate demand would shift to the left.

B

Short-run aggregate supply would shift to the right.

C

Aggregate demand would shift to the right.

D

Short-run aggregate supply would shift to the right.

E

Long-run aggregate supply would shift to the left.