An Increase in the Price Level in the Aggregate Expenditures

question 155

Multiple Choice

An increase in the price level in the aggregate expenditures model would:

• A)decrease aggregate expenditures and real GDP.
• B)increase aggregate expenditures and real GDP.
• C)increase aggregate expenditures and decrease real GDP.
• D)decrease aggregate expenditures and increase real GDP.

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Definitions:

Public Good

A product or service that is made available to all members of a society, characterized by being non-excludable and non-rivalrous in consumption.

FM Radio Station

A broadcast station that uses frequency modulation to provide radio programming to the public within a certain geographic area.

Excludable

A feature of a product or service that enables the owner to restrict its use by others without obtaining consent.

Rival In Consumption

Describes a good or service whose consumption by one individual prevents simultaneous consumption by other individuals, making it exclusive in nature.