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long-run equilibrium

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Is there a unique rate of inflation that corresponds to long-run equilibrium? What determines the rate of inflation when the economy is at long-run equilibrium?

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Is there a unique rate of inflation that corresponds to long-run equilibrium? What determines the rate of inflation when the economy is at long-run equilibrium?

There is a unique rate of inflation to the long-run equilibrium. When the actual output is equal to the ...

Solution Summary

Long-run equilibrium is discussed very comprehensively in this explanation.

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current long-run equilibrium level of real GDP

Working with Graphs

Consider the graph below, and answer the following questions:

a)What is the current long-run equilibrium level of real GDP?
b)What is the current long-run equilibrium price level?
c)If the economy grows sufficiently at $2 trillion, real GDP remains forthcoming in the long run, and the aggregate demand remains unchanged, what will be the new long-run equilibrium price level? Use a Graph to show the shift.

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