Last Year in the Country of Union, the Price Level

question 192

Multiple Choice

Last year in the country of Union, the price level increased and real GDP increased. Such an outcome might have occurred because short-run aggregate supply __________ and aggregate demand __________ .

• A) increased; did not change
• B) did not change; increased
• C) decreased; decreased
• D) increased; decreased

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Definitions:

Earnings Gap

The difference in average earnings between different groups in the economy, often discussed in terms of gender, race, or education level.

Maximizing Profits

The process by which a business seeks to achieve the highest possible return or profit from its operations.

Employment Discrimination

Unfair or prejudicial treatment of employees or job applicants based on race, gender, age, religion, nationality, disability, or sexual orientation.

Compensating Differential

Additional income or benefits offered to employees for accepting less desirable job conditions.