Which of These Questions Does Aggregate Demand Help Us Answer

question 145

Multiple Choice

Which of these questions does aggregate demand help us answer? I. What determines the total amount of our output that individuals, firms, governments and foreigners want to buy?
II) What is the economy's long-run real Gross Domestic Product (GDP) ?
III) What determines the economy's equilibrium price level and the rate of inflation?

• A) I only
• B) I and II
• C) II and III
• D) I and III

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Definitions:

Journal Entry

A record in accounting that represents a transaction and shows the accounts affected and the amounts.

Sale

A transaction between two parties where the buyer receives goods, services, or assets in exchange for money or other forms of compensation.

Issuing Bonds

The process of a borrower offering bonds to investors as a form of debt securities to raise capital.