Exhibit 35-1 ​

question 44

Multiple Choice

Exhibit 35-1
​

-Refer to Exhibit 35-1, where the higher the number, the better the position for the person to whom the number is connected. Jaden and Karen have entered into an agreement and are currently in box 1. There is no enforcer to their agreement. Jaden and Karen are likely to

• A)remain in box 1.
• B)move to box 2, because this box is better for Jaden.
• C)move to box 3, because this box is better for Karen.
• D)move to box 4.
• E)There is not enough information to answer the question.

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Definitions:

Actual Output

The total value of goods and services produced by an economy at a given period, also known as real GDP.

Aggregate Supply

The total supply of goods and services produced within an economy at a given overall price level and in a given time period.

Price Level

The average of current prices across the entire spectrum of goods and services produced in the economy, often used as a measure of inflation.

Expected Price Level

The anticipated average level of prices in the economy for goods and services, as predicted by consumers and businesses.