A Deep Recession Hits the World Economy,and Real GDP in the Rest

question 155

Multiple Choice

A deep recession hits the world economy,and real GDP in the rest of the world decreases.In Australia,

• A)aggregate supply and aggregate demand both increase,and the price level rises.
• B)aggregate supply and aggregate demand both decrease,and the price level rises.
• C)aggregate demand decreases while aggregate supply does not change,and the price level falls.
• D)aggregate supply decreases while aggregate demand does not change,and the price level rises.
• E)aggregate supply increases and aggregate demand decreases,so the effect on the price level is uncertain.

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Definitions:

Fair Market

The price at which a willing buyer and seller would agree to transact in an open and unrestricted market.

Common Stock

Common stock represents equity ownership in a corporation, where shareholders are entitled to vote on corporate matters and possibly receive dividends.

Reacquired

Refers to previously issued stocks or securities that have been bought back by the issuing company.

Treasury Stock

Shares that were issued and later repurchased by the issuing company, reducing the amount of outstanding stock.