How Would Supply Affect the Aggregate Output of an Economy

question 87

Multiple Choice

How would supply affect the aggregate output of an economy?

• A) Supply would decrease aggregate output.
• B) Increases in both would cause inflation.
• C) Aggregate output would grow with supply.
• D) Supply would have no direct effect on aggregate output.
• E) Aggregate output would increase the money supply.

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Definitions:

Net Pay

The amount of an employee's earnings after all deductions, such as taxes and retirement contributions, have been subtracted.

Promissory Note

A financial instrument that contains a written promise by one party to pay another a definite sum of money either on demand or at a specified future date.

Employer Cost

The total expense incurred by employers to compensate employees, including salaries, benefits, and taxes.

Interest Expense

The cost incurred by an entity for borrowing funds.