If There Is an Excess Demand Situation in the Economy

question 17

Multiple Choice

If there is an excess demand situation in the economy at the current price level, then the:

• A)price level will remain the same
• B)economy must be operating on the flat section of the AS curve
• C)price level will increase
• D)price level will definitely decrease

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Definitions:

Disaffirm

The legal act of renouncing or voiding a contract or agreement, particularly as it relates to individuals who were not competent to enter into the contract initially, like minors.

Unconscionable Contracts

Agreements between parties that are so unfair or one-sided that they shock the conscience, often rendering them unenforceable in court.

Transfer Of Assets

The act of moving ownership of assets from one party to another, which could involve property, financial instruments, or other resources.

In Pari Delicto

In equal fault. A contract relationship when both parties to an illegal agreement are equally wrong, in the knowledge of the operation and effect of their contract.