In the Long Run,an Increase in Aggregate Demand

question 26

Multiple Choice

In the long run,an increase in aggregate demand:

• A)increases the price level and real output,but the effect on the price level is larger.
• B)increases the price level and real output,but the effect on output is larger.
• C)affects only real output.
• D)affects only the price level.
• E)affects neither the price level nor real output.

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Definitions:

Activity Variance

The difference between the planned activity level and the actual activity level.

Planning Budget

A financial forecast or projection, detailing expected revenues and expenses within a future period.

Net Operating Income

The profit a company generates from its regular business operations, excluding expenses and revenues from non-operating activities.

Client-visits

The act of meeting with clients or potential clients, often for the purposes of discussing business opportunities, providing services, or strengthening relationships.