In the Aggregate Demand/aggregate Supply Model,an Increase in a Country's

question 70

Multiple Choice

In the aggregate demand/aggregate supply model,an increase in a country's sustainable potential output is represented by an increase in

• A)prices.
• B)aggregate demand.
• C)long-run aggregate supply.
• D)an increase in the general level of prices.

---

Definitions:

Acid Test Ratio

A liquidity ratio; those assets that are most easily converted to cash are divided by current liabilities to indicate ability to pay off short-term debt. Also called quick ratio.

Quick Assets

Assets that can be quickly converted into cash without significantly affecting their value, such as stocks and receivables.

Current Liabilities

Current liabilities are a company's debts or obligations that are due to be paid within a year, including accounts payable, short-term loans, and accrued expenses.

Debt to Equity Ratio

A financial ratio indicating the relative proportion of shareholders' equity and debt used to finance a company's assets.