In the Short Run, a Contractionary Supply Shock Causes the Average

question 57

Multiple Choice

In the short run, a contractionary supply shock causes the average price level to _____ and the total output level to:

• A) fall; rise.
• B) fall; fall.
• C) rise; rise.
• D) rise; fall.

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Definitions:

Enhance Customer Perceptions

Strategies aimed at improving how consumers view and evaluate a company's products or services.

Markdowns

Reductions in the selling price of goods, often to clear old stock or respond to reduced demand.

Complementary Products

Products that enhance the use of a primary product or are better used in conjunction with the primary product, increasing customer satisfaction and sales opportunities.

Maintained Markup

The practice of keeping the difference between the cost price and selling price consistent across products or over time.