The Figure Below Shows the Aggregate Demand and Supply Curves

question 7

Multiple Choice

The figure below shows the aggregate demand and supply curves for the U.S.In this figure,as the aggregate demand curve shifts from AD to AD',the equilibrium price level in period 1:

• A)increases from 3 to 4.
• B)decreases from 4 to 3.
• C)decreases from 4 to 1.
• D)increases from 1 to 4.
• E)decreases from 4 to 2.

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Definitions:

Motor Vehicle Industry

The sector of the economy associated with the production, marketing, and maintenance of motor vehicles.

MC2

A formula representing the equivalence of mass (m) and energy (E), with c2 signifying the speed of light squared, as theorized by Albert Einstein in his theory of relativity.

Cartels

Associations of independent businesses or organizations that collaborate to control prices, limit competition, or regulate the production and distribution of goods and services.

Group Profits

The total profit earned by a collective of companies or entities.