If the Current Short-Run Equilibrium Level of Output Is Less

question 144

Multiple Choice

If the current short-run equilibrium level of output is less than full-employment output,we can then expect that in the long run

• A) the price level will fall.
• B) the price level will rise.
• C) aggregate demand will decrease.
• D) aggregate demand will increase.
• E) long-run aggregate supply will decrease.

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Definitions:

Cash Flow from Assets

Represents the total amount of money being transferred in and out of a company's assets, encompassing operating, investing, and financing cash flows.

Operating Cash Flow

The cash generated by a company's normal business operations, indicating whether a company can generate enough positive cash flow to maintain and grow its operations.

Net Working Capital

The financial contrast between a company's short-term assets and its short-term obligations.

Fixed Assets

Long-term tangible assets used in the operation of a business that are not likely to be converted to cash in the short term, such as buildings, machinery, and equipment.