Which of the Following Is Not an Assumption Made by the Dynamic

question 14

Multiple Choice

Which of the following is not an assumption made by the dynamic model of aggregate demand and aggregate supply?

• A)Potential GDP increases continuously.
• B)Aggregate demand shifts to the right during most periods.
• C)Aggregate supply shifts to the right except during periods when workers and firms expect higher wages.
• D)Aggregate demand and potential GDP decrease continuously.

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Definitions:

Capital Contributions

Investments made by owners or partners in a business, typically in the form of cash, property, or other assets, to provide funding for the business.

Management

The process of dealing with or controlling things or people within an organization.

Profit

The financial gain that is made when the revenue from business activities exceeds its costs.

Limited Partnership

is a form of partnership characterized by having one or more general partners with unlimited liability, and one or more limited partners whose liability is limited to the amount of their investment.