Advanced Placement (AP), 30.11.2020 01:00 valvaldeziv6373

6. Assume the economy is in long run equilibrium . Following a decrease in aggregate demand which of the following is true in the short run? A. The unemployment rate is equal to the natural rate of unemployment , and the rate of inflation is rising B. The unemployment rate is greater than the natural rate of unemployment, and the rate of inflation is rising . The unemployment rate is greater than the natural rate of unemployment, and the rate of inflation is declining. D. The unemployment rate is lower than the natural rate of unemployment , and the rate of inflation is declining. The unemployment rate is lower than the natural rate of unemployment , and the rate is rising Please explain WHY the answer you choose is right

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