Optimism Imagine that the economy is in long-run equilibrium. Then, perhaps because of improved international relations and increased confidence in policy makers, people become more optimistic about the future and stay this way for some time. Refer to Optimism. In the short run what happens to the price level and real GDP?

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A: Option (2).

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A: Aggregate demand: The demand for goods and services in a specific market.

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Q: or False: The economy is currently in short-run equilibrium.

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A: