When Aggregate Supply Increases, All of the Following Result Except

question 101

Multiple Choice

When aggregate supply increases, all of the following result except:

• A) equilibrium level of real GDP increases
• B) unemployment decreases
• C) the price level decreases
• D) cost-push inflation results
• E) none - all of these result when aggregate demand increases

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Definitions:

Hindsight Bias

The tendency to believe, after an event has occurred, that one would have predicted or expected the outcome, known also as the "knew-it-all-along" effect.

Testable Predictions

Hypotheses that can be empirically investigated through experiment or observation to be proven true or false.

Research

The systematic investigation into and study of materials and sources to establish facts and reach new conclusions.

Scientific Attitude

The approach of being open-minded, skeptical, and analytical about evidence and explanations, characteristics valued in scientific investigation.