Question

Which of the following statements relating to equilibrium in the AD-AS model is true?

In the short run, AD must equal SRAS at equilibrium; in the long run, AD need not equal SRAS at equilibrium.

In long-run equilibrium, AD equals SRAS equals LRAS.
In long-run equilibrium, there will be cyclical unemployment if AD is less than SRAS.
Long-run equilibrium never occurs, since the rate of unemployment must equal zero at that equilibrium.
In long-run equilibrium, if there is significant cyclical unemployment, wages and prices will rise.

Answer 1

Answer: The answer is this:

In long-run equilibrium, AD equals SRAS equals LRAS.

Step-by-step explanation:

The long-run equilibrium is the point where the AD, SRAS, and LRAS intersect.