Suppose There Was an Unexpected Increase in Aggregate Demand

question 281

Multiple Choice

Suppose there was an unexpected increase in aggregate demand. We would expect to observe

• A) frictional unemployment to increase.
• B) the duration of unemployment and the amount of unemployment to decrease.
• C) higher wages, with the duration of unemployment and the amount of unemployment unchanged.
• D) a decrease in aggregate demand.

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Definitions:

Activity Base

An activity base is a measure used in cost accounting to allocate overhead costs to products or services, based on activities such as machine hours or labor hours.

Work Orders

Instructions or orders issued for the completion of a job or task, typically including details such as materials, labor, and specifications.

Income From Operations

Earnings generated from a company's regular, core business operations, excluding deductions of interest and taxes.

Income From Operations

Revenue from a company's primary business activities, excluding costs and expenses.