According to the Classical Model of the Price Level, the Short-Run

question 45

Multiple Choice

According to the classical model of the price level, the short-run aggregate supply curve is:

• A) flat.
• B) negatively sloped.
• C) vertical.
• D) unstable.

---

Definitions:

Aggregate Demand

The combined need for all commodities and services in an economy, quantified at a set price level and within a specific period.

Federal Budget Surplus

A situation where the government's income exceeds its spending, resulting in excess funds for a given fiscal period.

National Debt

The aggregate sum of funds that a nation's government has accrued in debt and remains liable for.

Federal Budget Deficit

The shortfall in the federal government's revenue compared to its expenditures over a specified period, typically a fiscal year.