If the Economy Is in Long Run Equilibrium and Then

question 6

Multiple Choice

If the economy is in long run equilibrium and then aggregate demand increases, in the long run the increase in aggregate demand means that the

• A) price level will be higher but real GDP will be unaffected.
• B) real GDP will be larger but the price level will be unaffected.
• C) the price level will be higher and real GDP will be larger.
• D) neither the price level nor real GDP will be unaffected.

Understand the concepts of separation of powers and checks and balances as outlined in the U.S. Constitution.

Recognize the significance of compromises made during the Constitutional Convention.

Understand the role and impact of the Federalist and Antifederalist Papers on the ratification of the Constitution.

Understand how historical grievances and revolutionary ideas contributed to the Declaration of Independence.

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Definitions:

Estimated Cost

An approximation of the future cost of producing a product, completing a project, or maintaining a service.

FICA Taxes

Taxes paid by both employees and employers to fund Social Security and Medicare, based on a percentage of the employee's earnings.

Federal Unemployment Taxes

Taxes levied by the federal government on employers to fund state workforce agencies and unemployment insurance.

State Unemployment Taxes

Taxes imposed by state governments on employers, based on the amount of wages paid to employees, to fund unemployment compensation benefits.