How Will an Increase in the Price Level Affect the Aggregate

question 22

Multiple Choice

How will an increase in the price level affect the aggregate expenditure line?  

• A) It will shift the aggregate expenditure line upward. 
• B) It will shift the aggregate expenditure line downward. 
• C) It will cause a movement up along the aggregate expenditure line. 
• D) It will cause a movement down along the aggregate expenditure line.

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Definitions:

Deskilling

Refers to the process by which work tasks are broken into simple routines requiring little training to perform. Deskilling is usually accompanied by the use of machinery to replace labour wherever possible and increased management control over workers.

Scientific Management

Developed in the 1910s by Frederick W. Taylor, is a system for improving productivity. After analyzing the movements of workers as they did their jobs, Taylor trained them to eliminate unnecessary actions. This technique is also known as Taylorism.

Productivity

A measure of the efficiency of production, often quantified as the ratio of inputs to outputs in economic terms.

Taylorism

A theory of management that analyzes and synthesizes workflows, with the primary objective of improving economic efficiency, especially labor productivity.