We Observe a Decrease in the Price Level and an Increase

question 36

Multiple Choice

We observe a decrease in the price level and an increase in real GDP. Which of the following is a possible explanation?

• A)a decrease in the quantity of money
• B)a decrease in expected future income
• C)an increase in factor prices
• D)an increase in the quantity of capital
• E)an increase in expected future profits

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Definitions:

Collecting Taxes

The process by which a government or authority gathers monetary contributions from citizens and businesses to fund public services and infrastructure.

Popular Majority

The majority of total votes cast by the public in an election, as opposed to a majority of elected representatives or electoral votes.

Tyranny

Tyranny is a form of government in which a single ruler holds absolute power and exercises it in a cruel or unjust manner.

Antifederalists

Opponents of the ratification of the U.S. Constitution, who favored a weaker central government.