The Price Level in India Increases from 131 to 137

question 310

Multiple Choice

The price level in India increases from 131 to 137 while its trading partnersʹ price levels remain constant. As a result, people will buy ____________ Indian -made goods and there will be a ____________ movement
Along Indiaʹs aggregate demand curve.

• A) more; downward
• B) more; upward
• C) less; upward
• D) less; downward

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Definitions:

Selling Price

The amount for which a product is sold to the customer, generally set above the cost to include a profit margin.

Margin Of Safety

The difference between actual or expected sales and sales at the break-even point, measured in either units or revenue.

Break-Even Point

The quantity of production or sales at which total revenues equal total expenses, resulting in no net loss or gain.

Variable Expenses

Costs or expenses that vary in direct proportion to changes in business activity levels, such as sales volumes or production output.