The Following Image Shows the Aggregate Demand and Aggregate Supply

question 59

Multiple Choice

The following image shows the aggregate demand and aggregate supply curves of an economy.In the graph below,the rise in the price levels from P₁ to P₂ is a result of:

• A)cost-pull inflation.
• B)cost-push inflation.
• C)demand-push inflation.
• D)demand-pull inflation.
• E)induced inflation.

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Definitions:

Horizontal Integration

A strategy used by businesses to increase their market share by acquiring or merging with competitors operating at the same level of the supply chain.

Supply-Chain Strategy

Planning and management of all activities involved in sourcing, procurement, and logistics management activities.

Vertical Integration

The expansion of a company's operations into different stages of production within the same industry, usually to increase control over the supply chain.

Cost-Based Price Model

A pricing strategy where the selling price is determined by adding a mark-up to the total cost of production.