The Economy Experiences a Decrease in the Price Level and an Increase

question 36

Multiple Choice

The economy experiences a decrease in the price level and an increase in real domestic output.Which is a likely explanation?

• A)consumer incomes and the quantity of labour have decreased
• B)interest rates and wage rates have decreased
• C)the prices of imported resources have increased
• D)national income abroad has increased

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Definitions:

Investment

New capital additions to a firm’s capital stock. Although capital is measured at a given point in time (a stock), investment is measured over a period of time (a flow). The flow of investment increases the capital stock.

Demand Curve

A graph showing the relationship between the price of a good and the amount of it that consumers are willing to purchase at various prices.

Hoverboards

Self-balancing scooters that use gyroscopic technology to allow users to move based on the direction and speed of their body lean.

Factors Of Production

The resources used in the creation of goods and services, including land, labor, capital, and entrepreneurship.