Based on the Keynesian Theory of the Business Cycle, If

question 34

Multiple Choice

Based on the Keynesian theory of the business cycle, if the economy is at its full-employment equilibrium and aggregate demand increases then

• A) the price level and real GDP both increase.
• B) the price level rises but real GDP remains unchanged.
• C) the price level and real GDP both decrease.
• D) real GDP decreases and the price level remains unchanged.

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Definitions:

Middle Adulthood

A life stage typically ranging from about 40 to 65 years old, characterized by stability, growth in career and family life, and facing the reality of aging.

Early Adulthood

refers to a life stage following adolescence, typically involving the ages 20 to 40, marked by the pursuit of independence, career development, and for many, establishing a family.

Late Childhood

A developmental phase typically ranging from ages 6 to 12, marked by significant growth in social, cognitive, and emotional abilities.

Formal Operational

The final stage in Piaget's theory of cognitive development, marked by the ability to think abstractly and logically.