In the Short Run, an Increase in Aggregate Demand

question 119

Multiple Choice

In the short run, an increase in aggregate demand

• A) lowers the price level and decreases real GDP.
• B) lowers the price level and increases real GDP.
• C) raises the price level and increases real GDP.
• D) raises the price level and decreases real GDP.

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Definitions:

Standard Deviation

A measure of the amount of variation or dispersion in a set of values, indicating how much the values deviate from the mean.

Range

The difference between the highest and lowest values in a set of numbers, indicating the spread or dispersion of the dataset.

Empirical Rule

The empirical rule, also known as the 68-95-99.7 rule, states that for a normal distribution, approximately 68% of the data falls within one standard deviation of the mean, 95% within two, and 99.7% within three.

Normal Curve

A symmetrical, bell-shaped curve that represents the distribution of values, deviations, or probabilities for a set of data in which most measurements cluster around the mean.