An Increase in Aggregate Demand Is Most Likely to Be

question 134

Multiple Choice

An increase in aggregate demand is most likely to be caused by a decrease in:

• A)the wealth of consumers.
• B)consumer confidence.
• C)business confidence.
• D)the tax rates on household income.

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Definitions:

Fixed Cost

Costs that do not vary with the level of production or sales, such as rent, salaries, and insurance, which are incurred regardless of the quantity produced.

Patent

A legal right granted by a government to an inventor, giving the holder exclusive rights to use, sell, and manufacture the invention for a certain period of time.

Zero Marginal Cost

A situation where producing one additional unit of a good or service does not increase the total cost of production.

Fixed Cost

Fixed costs are business expenses that remain constant regardless of the level of production or sales, such as rent or salaries.