If an Economy Is in Equilibrium at a Given Price

question 188

Multiple Choice

If an economy is in equilibrium at a given price level and a given output level,the aggregate demand/aggregate supply (AD/AS) model indicates that an unanticipated decrease in aggregate demand will cause

• A)real output to decline.
• B)the price level to fall.
• C)unemployment to increase.
• D)all of the above.

Acknowledge the importance of proper document formatting, including lists and tables.

Appreciate the necessity of starting the report composition process with relevant sections.

Recognize the imperative of specifying limitations within a report.

Understand the core concepts and importance of ethics in organizational behavior.

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Definitions:

Unemployment Compensation

Financial payments made to individuals who have lost their jobs, provided by the government or other authorized bodies to support them while they search for new employment.

Sticky Wages

The tendency of nominal wages to adjust slowly to changes in the economy, such as inflation or unemployment, often leading to disequilibrium in the labor market.

Actual Price Level

The current average of all prices of goods and services in an economy, reflecting the purchasing power of money.

Quantity of Output

The total amount of a product or service that is produced by a company or an economy.