An Increase in the U

question 131

Multiple Choice

An increase in the U.S.price level relative to the price level of U.S.trading partners will cause the aggregate expenditures function in the United States to

• A)shift up.
• B)shift down.
• C)get flatter.
• D)get steeper.

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Definitions:

Retained Earnings

The portion of net income left over for the business after it has paid out dividends to its shareholders, indicated on the balance sheet.

Net Income

The conclusive profit of a corporation post-deduction of all operational costs and taxation from the aggregate revenue.

Cash Dividends

Payments made by a corporation out of its earnings to its shareholders, usually in the form of cash.

Stock Dividends

A payment made to shareholders in the form of additional shares, rather than cash.