If in the Short Run Prices Did Not Respond at All

question 57

Multiple Choice

If in the short run prices did not respond at all to changes in aggregate demand, the short-run aggregate supply curve would

• A)be vertical.
• B)be horizontal.
• C)slope up.
• D)slope down.

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Definitions:

Low-Interest Rate Policy

A monetary policy strategy used by central banks to maintain low borrowing costs to stimulate economic growth.

Housing Prices

The cost to purchase a residential property, which fluctuates based on demand, location, and economic conditions.

Lending Standards

The criteria used by lenders to determine the creditworthiness of potential borrowers.

Mortgage Default Rate

The percentage of borrowers who fail to make scheduled payments on their mortgage loans, leading to the risk of foreclosure.