Asked by
Kunle Animashaun
on Oct 13, 2024
Verified
Assume the aggregate demand curve intersects the aggregate supply curve in its intermediate range.A decrease in the aggregate supply curve will
A) increase the price level and decrease real GDP.
B) decrease the price level and increase real GDP.
C) increase both the price level and real GDP.
D) decrease both the price level and real GDP.
Aggregate Demand Curve
A graphical representation showing the relationship between the overall price level and the total demand for goods and services in an economy.
Aggregate Supply Curve
A graph that shows the relationship between the overall price level in the economy and the total output produced by firms, holding all else constant.
Price Level
Price Level is a measure of the average prices of goods and services in an economy, indicating the purchasing power of the currency and cost of living.
- Examine the effects of changes in overall demand or supply on the economic balance.
Verified Answer
JP
Learning Objectives
- Examine the effects of changes in overall demand or supply on the economic balance.