If the Economy Is near Full Capacity, the Effect of a Negative

question 341

Multiple Choice

If the economy is near full capacity, the effect of a negative aggregate demand shock is to

• A) increase the level of aggregate demand.
• B) cause the price level to fall.
• C) increase the firm's cost of producing at every level of output.
• D) increase the level of employment.

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Definitions:

Patriot Forces

Military units fighting for independence or a cause, often used in the context of the American Revolutionary War.

Iroquois Bands

Subdivisions or groups within the Iroquois Confederacy, a historically powerful and influential alliance of indigenous tribes in North America.

Ancestral Homeland

A geographical region or land associated with a person's lineage or heritage, often regarded with cultural and emotional significance.

General John Sullivan's

Referring to an American general during the Revolutionary War known for his roles in several key battles and campaigns.