An Increase in Aggregate Demand Is Beneficial in the Short

question 141

Multiple Choice

An increase in aggregate demand is beneficial in the short run because ________ but not in the long run because ________.

• A) output decreases; the unemployment rate falls
• B) the unemployment rate falls; the price level rises
• C) wages decrease; wages increase
• D) real wealth decreases; real wealth increases
• E) wages increase; the unemployment rate rises

---

Definitions:

Sequential Method

A technique in cost accounting where support department costs are allocated to other departments in a specific sequential order, taking into consideration the services provided by each support department.

Janitorial Department

A segment of a business or organization responsible for cleaning, maintenance, and upkeep of buildings and facilities.

Square Footage

The area of a space measured in square feet, often used in real estate to quantify the size of buildings or rooms.

Reciprocal Services Method

A method used in managerial accounting to allocate costs between departments when those departments provide services to each other.