According to neoclassical theory, changes in GDP, or the vertical AS curve, will be caused by...

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According to neoclassical theory, changes in GDP, or the vertical AS curve, will be caused by...

According to neoclassical theory, changes in GDP, or the vertical AS curve, will be caused by

-cyclical unemployment.

-potential output changes.

-aggregate demand changes.

business economics

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Answer 1

Answer #1

In Neoclassical theory the AS curve is vertical, which represent the potential level of output which an economy would produce at full employment level.

The change in vertical AS curve will be caused by change in potential output.

Answer: option (b).

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Answer 2

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