An Increase in Aggregate Demand Is Most Likely to Cause

question 142

Multiple Choice

An increase in aggregate demand is most likely to cause an increase in the price level when the economy is

• A)operating near full employment.
• B)on the horizontal part of the aggregate supply curve.
• C)operating with high unemployment.
• D)operating with substantial excess capacity.

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Definitions:

Forces

Influences or powers that cause an object to move or change, or metaphorically, factors that drive or influence events or decisions.

Role of Power

The influence or control exercised by an individual or group in various contexts, affecting decisions, actions, and outcomes within societies or organizations.

Social Rule

An established and accepted standard of behavior expected within a society or community.

Moral Values

Principles or standards of behavior considered to be important or beneficial for ethical living.