Suppose That Real Domestic Output in an Economy Is 20

question 211

Multiple Choice

Suppose that real domestic output in an economy is 20 units, the quantity of inputs is 10, and the price of each input is $4.Given an increase in input price from $4 to $6, we would expect the aggregate

• A)supply curve to shift to the left.
• B)supply curve to shift to the right.
• C)demand curve to shift to the left.
• D)supply and demand curves to both remain unchanged.

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Definitions:

Compound Interest

Compound interest is the interest calculated on the initial principal and also on the accumulated interest of previous periods of a deposit or loan.

Future Value

An estimated future value of a present asset, projected by applying an anticipated growth rate over time.

Present Value

Present value is the current worth of a future sum of money or stream of cash flows given a specified rate of return.

Compounded Quarterly

A method of calculating interest where the interest is added to the principal amount every quarter, leading to interest being earned on interest.