Use the Following Graph to Answer the Following Questions

question 112

Multiple Choice

Use the following graph to answer the following questions.This graph depicts an economy where aggregate demand has decreased,with no change in either short-run aggregate supply (SRAS) or long-run aggregate supply (LRAS) .

-As a result of aggregate demand decreasing,we can see that the price level ________ and real gross domestic product (GDP) ________.

• A) increased; increased
• B) decreased; decreased
• C) remained unchanged; increased
• D) decreased; remained unchanged
• E) increased; decreased

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Definitions:

Pricing

The strategy and methodology of determining the selling price of a product or service, taking into account factors like cost, demand, and competition.

Packaging

entails the process and materials used to enclose or protect products for distribution, storage, sale, and use, often playing a key role in marketing.

Production Costs

The total expenses incurred in manufacturing a product or providing a service, including materials, labor, and overhead.

Prospect Theory

A behavioral economic theory that describes how people make decisions based on perceived gains or losses rather than final outcomes, focusing on how individuals assess risk in the face of uncertainty.