The Canadian Price Level Rises

question 32

Multiple Choice

The Canadian price level rises. What is the effect on the quantity of real GDP demanded or aggregate demand in Canada?

• A)The quantity of Canadian real GDP demanded increases.
• B)The quantity of Canadian real GDP demanded decreases.
• C)Canadian aggregate demand increases.
• D)Canadian aggregate demand decreases.
• E)There is no change to either the quantity of real GDP demanded or to aggregate demand.

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Definitions:

Independent Variable

A variable in an experiment that is manipulated or changed by the researcher to observe its effect on the dependent variable.

Observed Value

The actual value measured or recorded during an experiment or survey.

Dependent Variable

In an experiment, the dependent variable is the variable that is being tested and measured, and is 'dependent' on the independent variable.

Residual

The difference between the observed value and the estimated value of the quantity of interest.