Aggregate Demand Shocks Have a Large Effect on Real GDP

question 17

Multiple Choice

Aggregate demand shocks have a large effect on real GDP and a small effect on the price level

• A)on the downward- sloping portion of the AS curve.
• B)the steeper the AS curve.
• C)if the AD curve is steep.
• D)when the AS curve is vertical.
• E)the flatter the AS curve.

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Definitions:

Rate of Movement

The speed at which a certain object or substance moves through space or a medium.

Unconsolidated

Referring to sediments or materials that are loosely held together or not cemented, often allowing for the easy movement of water or air.

Weathered Bedrock

The result of bedrock being broken down by physical, chemical, or biological weathering processes, often leading to soil formation.

Terracing

The practice of shaping steep terrain to provide flat areas suitable for agriculture or ranching, or to protect soil from erosion.