If the Economy Is in Long Run Equilibrium and Then

question 163

Multiple Choice

If the economy is in long run equilibrium and then aggregate demand increases, in the long run the increase in aggregate demand means that the

• A) real GDP will be larger but the price level will be unaffected.
• B) the price level will be higher and real GDP will be larger.
• C) price level will be higher but real GDP will be unaffected.
• D) neither the price level nor real GDP will be unaffected.

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Definitions:

Upper Limit

The maximum value in a range or set, beyond which no observations in the data set fall or are allowed.

Relative Frequency Distribution

A tabular summary of data showing the fraction or proportion of observations in each of several nonoverlapping categories or classes.

Fraction

A mathematical expression representing the division of one number by another, denoting part of a whole.

Total Number

The entirety or sum of amounts, quantities, or counts of items in a set.