If Factor Prices Remain Constant, an Increase in Aggregate Demand

question 56

Multiple Choice

If factor prices remain constant, an increase in aggregate demand

• A)increases the price level and increases real GDP.
• B)increases the price level and decreases real GDP.
• C)decreases the price level and increases real GDP.
• D)decreases the price level and decreases real GDP.
• E)increases the price level, and leaves real GDP unchanged.

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Definitions:

Explicit Memories

Memories that can be intentionally and consciously recalled, such as facts and events.

Implicit Memories

Memories that are not consciously recalled but affect behavior and knowledge, such as skills and tasks learned through repetition.

Implicit Memory

A type of memory that enables us to perform tasks without conscious awareness of these previous experiences, such as procedural memory for skills.

Classically Conditioned

A learning process that occurs when two stimuli are repeatedly paired; a response that is at first elicited by the second stimulus is eventually elicited by the first stimulus alone.