If Aggregate Demand Decreases, And, as a Result, Real Output

question 165

Multiple Choice

If aggregate demand decreases, and, as a result, real output and employment decline but the price level remains unchanged, it is most likely that

• A) the money supply has declined.
• B) the price level is inflexible downward and a recession has occurred.
• C) cost-push inflation has occurred.
• D) productivity has declined.

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Definitions:

Output Signal

The information or power delivered by a system or device as a response to a specific input, often used in the context of electronics or communication.

PI-type Filters

A form of electronic filter design that combines a parallel capacitor with a series inductor to block unwanted frequencies, characterized by its resemblance to the letter "PI" in schematic diagrams.

Greek Letter

Characters from the Greek alphabet used in mathematics, science, and engineering as symbols for constants, variables, and coefficients.

Band-rejection Filter

A filter designed to block frequencies within a specific range while allowing frequencies outside of that range to pass.