Holding All Else Constant,in the Short Run,a Decrease in the Money

question 54

Multiple Choice

Holding all else constant,in the short run,a decrease in the money supply can cause a(n) :

• A) decrease in unemployment.
• B) high rate of inflation.
• C) increase in the price level.
• D) decrease in real gross domestic product (GDP).
• E) increase in real GDP.

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Definitions:

Variable Selling Expense

Costs that vary directly with the volume of sales or production, such as commissions and shipping charges.

Fixed Selling Expense

The costs associated with selling a product or service that do not vary with sales volume, such as salaries of sales staff and advertising expenses.

Variable Administrative Expense

Costs associated with administrative activities that vary with the level of business activity or output.

Reclassifying Costs

The process of moving costs from one category to another in accounting records.