Within the AD/AS Model, If Consumers and Investors Become More

question 137

Multiple Choice

Within the AD/AS model, if consumers and investors become more optimistic about the future direction of the economy,

• A) aggregate demand will decrease.
• B) aggregate demand will increase.
• C) long-run aggregate supply will increase.
• D) long-run aggregate supply will decrease.

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Definitions:

Expected Value

The weighted average of all possible outcomes of a random variable, considering the probabilities of each outcome.

Decision Table

A tool used in both computing and decision analysis, indicating actions to be taken based on various conditions.

Conditional Value

The value of an asset, item, or scenario that depends on the fulfillment of certain conditions or the occurrence of specific events.

Historical Probability

The likelihood of an event occurring based on past data and trends.