If Factor Prices Remain Constant, an Increase in Aggregate Demand

question 96

Multiple Choice

If factor prices remain constant, an increase in aggregate demand

• A)increases the price level, and leaves real GDP unchanged.
• B)decreases the price level and decreases real GDP.
• C)increases the price level and increases real GDP.
• D)decreases the price level and increases real GDP.
• E)increases the price level and decreases real GDP.

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Definitions:

Gain

An increase in wealth or resources, often resulting from a favorable difference between the purchase price and the selling price of assets.

Professional Contract

A written agreement detailing the terms of engagement between a professional service provider and their client or employer.

Accounting Records

Documents that businesses use to track their financial transactions and positions, essential for preparing financial statements and ensuring compliance.

Fair Value

Fair Value is the price at which an asset would be bought or sold in a transaction between willing parties, other than in a liquidation scenario.