If the Economy's AS Curve Is Vertical, the Multiplier in the AD/AS

question 101

Multiple Choice

If the economy's AS curve is vertical, the multiplier in the AD/AS model is

• A)negative.
• B)smaller than the simple multiplier.
• C)infinitely large.
• D)zero.
• E)equal to the simple multiplier.

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Definitions:

Rate of Pay

The amount of money a person is paid per unit of time, such as an hourly wage or annual salary.

Hourly Pay Rate

The compensation given for each hour of labor.

Average Rate

A value representing the middle point of a rate over a specified period, often calculated by summing rates and dividing by the number of rates.

Rate of Interest

The percentage of the loan amount charged for borrowing money, typically expressed as an annual rate.