Question: Beginning from short-run equilibrium at point E2 in Exhibit A-9, the economys movement to a new position of long-run equilibrium would best be described as

Beginning from short-run equilibrium at point E2 in Exhibit A-9, the economy’s movement to a new position of long-run equilibrium would best be described as

a. a movement along the AD2 curve with a shift in the SRAS1 curve.

b. a movement along the SRAS2 curve with a shift in the AD2 curve.

c. a shift in the LRAS curve to an intersection at E1.

d. No shift of any kind.

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