Refer to the Graph Given Below

question 117

Multiple Choice

Refer to the graph given below. Suppose an economy moves from point B₃ to point C₃ because of an increase in aggregate demand.Given the scenario, which of the following is likely to occur?

• A)Nominal wages will rise, and profits will decrease, thereby negating the short-run stimulus to production and employment so that the economy moves from C₃ to B₄.
• B)Real wages will rise, and profits will decrease, thereby negating the short-run stimulus to production and employment so that the economy moves from C₁ to B₁.
• C)Nominal wages will rise, and profits will decrease, thereby negating the short-run stimulus to production and employment so that the economy moves from C₃ to B₃.
• D)Nominal wages will rise, and profits will decrease, thereby negating the short-run stimulus to production and employment so that the economy moves from C₃ to C₂.

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Definitions:

Debtor's Possession

Referencing an instance where individuals or entities in debt retain control over their assets while undergoing legal or financial proceedings.

Secured Transaction

A transaction in which the payment of a debt is guaranteed by personal property owned by the debtor.

Personal Property

Movable assets owned by an individual, as opposed to real property like land or buildings.

Debtor

An individual or entity that owes money or is legally obligated to make payments to another party.