The Quantity of Real GDP Supplied Decreases If the Price

question 153

Multiple Choice

The quantity of real GDP supplied decreases if the price level ________ because it ________ profits.

• A)rises; increases
• B)rises; decreases
• C)falls; increases
• D)falls; decreases
• E)None of the above answers are correct because the AS curve is vertical so that the quantity of real GDP supplied does not change when the price level changes.

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Definitions:

Social Exchange Theory

A social psychological and sociological perspective that explains social change and stability as a process of negotiated exchanges between parties.

Economic Model

A theoretical construct that represents economic processes through a set of variables and a set of logical and/or quantitative relationships between them.

Benefits

Advantages or positive outcomes derived from a particular action, decision, or situation.

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A psychological theory suggesting that much of human behavior is motivated by an underlying fear of death, leading individuals to seek symbolic or literal immortality through their actions and beliefs.