In the Intermediate Range of the Aggregate Supply Curve, If

question 63

Multiple Choice

In the intermediate range of the aggregate supply curve, if government spending increases caused the aggregate demand curve to shift outwards, which of the following is most likely to occur?

• A) The price level and real GDP will both rise.
• B) The price level will not change, but real GDP will increase.
• C) The price level will rise, but real GDP will not change.
• D) Both the price level and real GDP will not change.

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Definitions:

Resolution

The act of solving a problem, dispute, or contentious matter, often involving deciding on a course of action or determining a clear outcome.

Bicultural Identity

Identity formation that occurs when adolescents identify in some ways with their ethnic group and in other ways with the majority culture.

Ethnic Culture

The shared practices, values, traditions, and beliefs of a specific ethnic group, distinguishing it from other groups.

Majority Culture

Refers to the dominant cultural practices and beliefs of the largest or most influential group within a society.