Use the Following Diagram to Answer the Following Questions

question 49

Multiple Choice

Use the following diagram to answer the following questions.

-Refer to Diagram 13-1. If the economy is currently in equilibrium at point B, increasing the money supply would:

• A) cause the equilibrium level of real GDP and the equilibrium price level to rise.
• B) cause the equilibrium level of real GDP and the equilibrium price level to fall.
• C) cause the equilibrium level of real GDP rise and the equilibrium price level to fall.
• D) cause the equilibrium level of real GDP fall and the equilibrium price level to rise.

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Definitions:

Manufacturing Overhead

Indirect factory-related costs that are incurred when producing a product, such as utilities, depreciation, and salaries of maintenance personnel.

Work in Process

Inventory that includes partially completed goods that are in the process of being manufactured but are not yet finished products.

Finished Goods

Products that have completed the manufacturing process and are ready for sale.

Cost of Goods Sold

The direct costs attributable to the production of the goods sold by a company, including material and labor expenses.