If the Short-Run Aggregate Supply Curve Is Positively Sloped and the Fed

question 50

Multiple Choice

If the short-run aggregate supply curve is positively sloped and the Fed increases the money supply,aggregate demand:

• A)falls,which increases real GDP and the price level.
• B)increases,which decreases real GDP and the price level.
• C)falls,which decreases real GDP and increases the price level.
• D)increases,which decreases real GDP and increases the price level.
• E)increases,which increases real GDP and the price level.

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Definitions:

Common Stock

Equity ownership in a corporation, representing a claim on its dividends and assets, typically granting voting rights.

Shares Outstanding

The total number of shares of a company that have been issued and are currently held by investors.

Stated Value

The nominal value assigned by a corporation to its issued shares, which might not reflect the market value but is used for internal accounting.

Paid-In Capital

The sum of money contributed by investors through the issuance of common or preferred stocks, counting both the share's nominal value and any excess over that nominal value.