In Long-Run Macroeconomic Equilibrium

question 216

Multiple Choice

In long-run macroeconomic equilibrium,

• A) the price level is fixed and aggregate demand determines real GDP.
• B) real GDP equals potential GDP.
• C) real GDP is less than potential GDP.
• D) real GDP and the price level are determined by short-run aggregate supply and aggregate demand and long-run aggregate supply is irrelevant.

---

Definitions:

Cross-functional Goals

Objectives that require collaboration and coordination across different departments or functions within an organization to achieve.

Low-margin Business

A business that operates with a small difference between the cost to produce goods or services and the selling price, resulting in low profit margins.

Adding Capacity

The process of increasing the potential output of a business to meet expected demand.

Leadership

The act of guiding or influencing a group towards achieving its goals, often involving making strategic decisions, motivating individuals, and fostering teamwork.