In the Short Run, the Intersection of the Aggregate Demand

question 293

Multiple Choice

In the short run, the intersection of the aggregate demand and the short-run aggregate supply curves,

• A) determines the equilibrium price level.
• B) determines the equilibrium level of real GDP.
• C) is a point where there is neither a surplus nor a shortage of goods.
• D) All of the above answers are correct.

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Definitions:

Normal Starting Balance

Normal Starting Balance refers to the initial amount of money in an account at the beginning of a financial period.

Debit Postings

Entries made on the left side of an account, increasing the balance of assets and expenses or decreasing liabilities and equity.

Credit Postings

Entries made on the credit side of an account ledger, indicating an increase in liability, revenue, or equity accounts, or a decrease in asset or expense accounts.

Liability Account

An accounting record used to track obligations the company owes to others, such as loans, leases, or accounts payable.