According to Classical Theory, a Shift in Aggregate Demand Will

question 174

Multiple Choice

According to classical theory, a shift in aggregate demand will affect

• A) the price level only.
• B) real Gross Domestic Product (GDP) only.
• C) the level of employment only.
• D) both real Gross Domestic Product (GDP) and the level of employment.

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Definitions:

Nominal Scale

A scale of measurement in which numbers are arbitrarily assigned to represent different categories or variables. The only math that can be applied to these numbers is calculation of the mode.

Arbitrarily Assigned

Assignments or classifications made without any specific criteria or reason, relying on random choice.

Interval Scale

A scale of measurement in which there are equal distances between measurements but no absolute zero reference point.

Equal Distances

In mathematics and statistics, a concept where the separation between points or values in a sequence or scale is consistent across the sequence.