In the Long Run,an Increase in Aggregate Demand Will Lead

question 64

Multiple Choice

In the long run,an increase in aggregate demand will lead to

• A)A higher price level and an increase in real GDP.
• B)A higher price level only.
• C)An increase in real GDP only.
• D)A decrease in real GDP.

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Definitions:

Accounts Payable

Financial obligations or debts that a company owes to its suppliers or creditors for goods and services received but not yet paid for.

Owners' Equity

Represents the residual interest in the assets of an entity after deducting liabilities, often referred to as shareholder equity.

Ending Inventory

Represents the final stock of goods available for sale by a firm at the close of an accounting period.

Beginning Inventory

The value of a company’s inventory at the start of an accounting period, carried over from the end of the previous period.