Which of the Following Statements Is Correct

question 31

Multiple Choice

Which of the following statements is correct?

• A)An increase in exports shifts the aggregate demand curve leftward.
• B)A tax increase shifts the aggregate demand curve leftward.
• C)The higher the price level,the larger is the quantity of real GDP demanded.
• D)An increase in potential GDP shifts the aggregate demand curve rightward.
• E)An increase in people's expected future income shifts the aggregate demand curve leftward.

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Definitions:

Cost-volume-profit Analysis

An accounting technique used to determine how changes in costs and volume affect a company's operating income and net income.

Sales Mix

The relative distribution of sales among the various products available for sale.

Fixed and Variable Costs

Costs that remain constant regardless of the level of production or business activity (fixed) and costs that vary in direct proportion to changes in activity (variable).

Cost-volume-profit Analysis

A financial approach that identifies how variations in expenses and production volume impact a business's operating profit and total earnings.