The prices of oil, gasoline, and other petroleum products, which are key inputs in production, have been decreasing in recent months. Other things being equal, which of the following is likely to occur in the U.S. economy as a result of the decline in oil prices?
(a) A decrease in both equilibrium price level and equilibrium real GDP.
(b) An increase in both equilibrium price level and equilibrium real GDP.
(c) A decrease in the equilibrium price level and an increase in equilibrium real GDP.
(d) An increase in the unemployment rate.
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(c) A decrease in the equilibrium price level and an increase in equilibrium real GDP.
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All of them..but not at the same time.|||I agree, the answer should be c).
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