Price Level Pz P1 AS₁ AS2 ADA AD3 AD2 AD₁ Q1 Q₂ Real Domestic Output Refer to the graph. Assume that the economy is initially in equilibrium at the intersection of AD₁ and AS1. Suppose that there is economic growth that shifts AS1 to AS 2. Because of the shift from AS1 to AS2, a monetarist following a monetary rule would call for an increase in aggregate demand such that the price level and quantity of real domestic output would be Multiple Choice P4 and Q2. P3 and Q2. P2 and Q2. P₁ and Q2.

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