If the World Economy Expands So That Foreign Demand for U.S.-Made

question 44

Essay

If the world economy expands so that foreign demand for U.S.-made goods increases, in the short run what will happen to aggregate demand, the price level, and real GDP in the U.S.?

---

Definitions:

Cost Center

A department or unit within an organization that does not directly add to profit but still incurs costs.

Departmental Contribution To Overhead

The amount of money that each department contributes towards covering the company's indirect costs or overheads.

Profit Center

A segment or division within a company that is responsible for generating its own revenue and profit, tracked separately for performance analysis.

Responsibility Accounting System

A system of accounting that tracks financial performance and costs at the level of individual responsibility centers, encouraging managerial accountability.