If Aggregate Demand Equals Output

question 38

Multiple Choice

If aggregate demand equals output,

• A)the economy is in a recession.
• B)output will increase.
• C)output will fall.
• D)the economy is at its equilibrium level.

---

Definitions:

Fixed Expenses

Costs that do not fluctuate with changes in production level or sales volume.

Trade-In Allowance

The amount credited to the buyer by the seller when the buyer trades in an old item towards the purchase of a new item.

Retain Or Replace

A decision-making process regarding whether to keep an existing asset or replace it with a new one, considering aspects such as costs, benefits, and performance.

Relevant Cost

Costs that should be considered when making a decision because they will affect the future and they differ among alternatives.