Use the Figure Below to Answer the Following Question

question 40

Multiple Choice

Use the figure below to answer the following question.

Figure 26.3.4
-Which of the following will lower the price level for sure?

• A)The AD curve shifts rightward and the SAS curve shifts leftward.
• B)The AD curve shifts rightward and the SAS curve remains unchanged.
• C)The SAS curve shifts leftward.
• D)The LAS curve shifts leftward.
• E)None of the above.

---

Definitions:

Real Money Balances

The amount of money held by individuals or entities, adjusted for inflation.

Nominal Money Assets

Financial assets measured in monetary terms without adjustment for inflation, representing their face value at a point in time.

Price Level

A measure of the average prices of goods and services in an economy, indicating the purchasing power of money and the cost of living.

Aggregate Demand-Aggregate Supply Diagram

A graphical representation used in macroeconomics to illustrate the relationship between total demand and total supply in an economy.