If the Economy Experiences Simultaneous Negative Aggregate Demand and Aggregate

question 33

Multiple Choice

If the economy experiences simultaneous negative aggregate demand and aggregate supply shocks,the new equilibrium price level ________ and the new equilibrium level of aggregate output ________.

• A) will he higher; will be lower
• B) will he lower; will be lower
• C) may be higher, lower, or not change; will be lower
• D) will be higher; may be higher, lower, or not change

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Definitions:

Firm's Managers

Individuals responsible for making significant corporate decisions and managing the overall operations and resources of a business.

Capital Budgeting

The process by which a business determines and evaluates potential expenses or investments that are significant in amount.

Project Cash Flows

Refers to the net amount of cash being transferred into and out of a project, considering all revenues, expenses, and capital costs over its life.

Risk

In finance, risk is the potential for financial loss or the variability in the returns of an investment.