Exhibit 10-4 Aggregate Supply and Demand Curves as the Aggregate

question 186

Multiple Choice

Exhibit 10-4 Aggregate supply and demand curves As the aggregate demand curve shifts from AD₁ to AD₂ in Exhibit 10-4, the economy experiences:

• A)cost-push inflation.
• B)demand-pull inflation.
• C)wage-push inflation.
• D)hyperinflation.

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Definitions:

Accounts Payable

Liabilities owed by a business to its suppliers or creditors for goods and services purchased on credit.

Note Payable

A written promise to pay a certain amount of money at a future date, often including interest.

Borrower

An individual or entity that takes out a loan from another entity or individual under the agreement to repay the amount borrowed, typically with interest.

Creditor

An individual, company, or institution that lends money or extends credit to another party, expecting to be repaid in the future.