11.4 Consequences of Changes in Aggregate Demand

question 76

Multiple Choice

11.4 Consequences of Changes in Aggregate Demand

-Refer to the above figure. An increase in aggregate demand beyond real Gross Domestic Product (GDP) level Y₁ would result in

• A)higher real GDP but not a higher price level.
• B)a lower price level but no change in real GDP.
• C)a higher price level but no change in real GDP.
• D)a lower price level and an increases in real GDP.

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Definitions:

Bomb Calorimeter

An apparatus used for measuring the heat of combustion of a particular reaction.

Combustion

A chemical process involving the rapid oxidation of substances, resulting in the release of energy, light, and heat.

Activation Energy

The minimum amount of energy that must be provided to compounds to induce a chemical reaction.

Pyrolysis

The chemical decomposition of a substance through the application of heat, in the absence of oxygen.