Aggregate Demand Decreases and Real Output Falls but the Price

question 13

Multiple Choice

Aggregate demand decreases and real output falls but the price level remains the same.Which factor most likely contributes to downward price inflexibility?

• A)the multiplier effect
• B)the wealth effect
• C)fear of price wars
• D)business taxes

---

Definitions:

Communication

The giving and receiving of ideas, feelings, and information among people.

Morale

Morale is the level of confidence, enthusiasm, and dedication a person or group feels towards a task or cause.

Workplace

A physical or virtual location where employees perform their job tasks.

Productivity

The measure of the efficiency of production of goods or services, often calculated as the output per unit of input.