In the Long Run,a Decrease in Aggregate Demand Will Lead

question 42

Multiple Choice

In the long run,a decrease in aggregate demand will lead to a(n) :

• A)decrease in price and output levels.
• B)increase in price and output levels.
• C)increase in the price level and a decrease in output.
• D)decrease in the price level and an increase in output.
• E)decrease in the price level and no change in output.

---

Definitions:

Processing Activity

The series of actions or operations conducted to modify, handle, or prepare materials or data.

Activity-Based Costing

An accounting method that assigns overhead and indirect costs to specific activities, providing more accurate product costing.

Overhead Cost

Expenses related to the operation of a business that cannot be directly traced to a specific product or service, such as rent, utilities, and administrative costs.

First Stage Allocations

The initial process of distributing overhead costs to various cost pools or departments in activity-based costing.