The Interest Rate Effect of a Change in the Aggregate

question 107

Multiple Choice

The interest rate effect of a change in the aggregate price level causes the:

• A) long-run aggregate supply curve to be vertical.
• B) aggregate demand curve to be negatively sloped.
• C) short-run aggregate supply curve to be positively sloped.
• D) aggregate demand curve to be positively sloped.

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Definitions:

Journal

A chronological record of all financial transactions, providing the initial point of entry for all accounting data into the accounting system.

Metric Unit

A system of measurement based on meters, liters, and grams, used internationally for scientific and commercial purposes.

Decimal Point

A dot or small mark used to separate the integer part from the fractional part of a decimal number.

Kilograms

A unit of mass in the metric system, equivalent to one thousand grams or approximately 2.20462 pounds.