When an increase in aggregate demand exceeds the increase in aggregate supply,
A. real GDP decreases while nominal GDP increases.
B. the price level falls while real GDP increases.
C. nominal GDP decreases and real GDP decreases.
D. the economy will experience inflation as the price level rises.
Answer:D
When an increase in aggregate demand exceeds the increase in aggregate supply,
A. real GDP decreases while nominal GDP increases. B. the price level falls while real GDP increases. C. nominal GDP decreases and real GDP decreases. D. the economy will experience inflation as the price level rises.