Refer to the Above Diagram

question 69

Multiple Choice

Refer to the above diagram.If the equilibrium price level is P₁, then:

• A)aggregate demand is AD₂.
• B)the equilibrium output level is Q₃.
• C)the equilibrium output level is Q₂.
• D)producers will supply output level Q₁.

---

Definitions:

Market Basket

A selected set of goods and services used to track changes in prices and inflation over time, representing the typical consumption of a household.

CPI

A gauge of the weighted average cost of a selection of consumer goods and services, including transportation, healthcare, and food, known as the Consumer Price Index.

CPI

Consumer Price Index, a measure that examines the weighted average of prices of a basket of consumer goods and services.

Market Basket

A fixed list of items used to track the progress of inflation in an economy.