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Suppose the economy is initially in long-run equilibrium Then suppose there is an increase in military spending due to rising international tensions According to the model of aggregate demand and aggregate supply what happens to prices and output in the short run ?

/ Economics Mcqs, The Aggregate Demand Aggregate Supply Model / By
Suppose the economy is initially in long-run equilibrium Then suppose there is an increase in military spending due to rising international tensions According to the model of aggregate demand and aggregate supply what happens to prices and output in the short run ?

A. Price fall; output rises
B. Price fall; output falls
C. Price rise; output fall
D. Price rise; output rise