If the Equilibrium Price Level Is 135 but the Actual

question 34

Multiple Choice

If the equilibrium price level is 135 but the actual price level is 150,then

• A)the quantity of real GDP demanded is greater than the quantity of real GDP supplied.
• B)the quantity of real GDP demanded is less than the quantity of real GDP supplied.
• C)aggregate demand will increase to restore equilibrium.
• D)firms increase their production because they are able to sell their output at a higher than expected price.
• E)aggregate demand will decrease to restore equilibrium.

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Definitions:

Inventory

The total amount of goods and materials held by a business for the purpose of resale or production.

Selling Expense

Costs incurred directly and indirectly in making sales, including advertising, shipping, and sales staff salaries.

Goods Sold

The total of merchandise that a company has sold to its customers within a specific period; often referred to as 'sales'.

Perpetual Inventory System

An inventory accounting system that records goods transactions in real-time.