In the Long Run,a Decrease in the Price Level

question 82

Multiple Choice

In the long run,a decrease in the price level:

• A) leaves output prices unchanged relative to input prices.
• B) increases the profit margins of many producers.
• C) decreases RGDP supplied.
• D) none of the above

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Definitions:

Demand Curve

A graphical representation of the relationship between the price of a good and the quantity demanded by consumers in a given time period.

Supply Curve

A supply curve graphically represents the relationship between the price of a good and the quantity of the good that suppliers are willing to sell, typically showing a direct relationship where higher prices incentivize higher supply.

Wage Rate

The amount paid to an employee per unit of time (e.g., per hour or year) for their labor.

Production Function

A mathematical model in economics that describes the relationship between inputs and the maximum output of goods or services produced.