If the Short-Run Aggregate Supply Curve Is Horizontal and the Bank

question 72

Multiple Choice

If the short-run aggregate supply curve is horizontal and the Bank of Canada increases the money supply, then:

• A)output and employment will increase in the short run.
• B)output and employment will decrease in the short run.
• C)prices will increase in the short run.
• D)prices will decrease in the short run.

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Definitions:

Level of Analysis

A framework in social science and international relations that categorizes the scale of inquiry or observation, ranging from individual-level, through organizational or group level, to the societal or international level.

Theoretical Traditions

Established frameworks and bodies of theory within academic disciplines that guide research, analysis, and interpretation in specific fields of study.

Homelessness

The condition of lacking stable, safe, and adequate housing, often resulting in people living on the streets, in shelters, or in temporary accommodations.

Yerkes-Dodson Law

A theory suggesting there is an optimal level of arousal for the best performance of a task: too little arousal can lead to inattention while too much can lead to stress and impaired performance.