In Short-Run Macroeconomic Equilibrium

question 5

Multiple Choice

In short-run macroeconomic equilibrium

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

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Definitions:

Individualism/collectivism Dimension

A cultural dimension that measures the degree to which individuals are integrated into groups and societal frameworks.

Power Distribution

The way in which power or authority is spread among individuals or groups within an organization or in the context of a negotiation.

Adapting

The process of making changes in order to cope with new situations or environments.

Party's Approach

This term describes the strategy or method adopted by an individual or group in negotiations, discussions, or in addressing issues.