If the Economy Is in Long Run Equilibrium and Aggregate

question 276

Multiple Choice

If the economy is in long run equilibrium and aggregate demand increases, then in the short run

• A) nothing happens because the economy is in long run equilibrium.
• B) the price level rises and real GDP does not change.
• C) real GDP increases and the price level does not change.
• D) the price level rises and real GDP increases.

Identify different types of government assistance programs and their objectives.

Comprehend the determination and implications of the poverty line.

Compare income distribution and inequality among countries and over time within the U.S.

Analyze the impact of income redistribution on societal welfare and individual utility.

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Definitions:

Service Charge

An additional fee charged for services rendered, often seen in the hospitality and banking industries.

Merchandise Sale

The process of selling goods that are purchased for resale, constituting a primary revenue source for retail businesses.

Allowance Method

A method in accounting for managing bad debts by predicting the accounts that cannot be collected at the end of every period.

Direct Write-off Method

An accounting method for recognizing bad debts where the specific uncollectible accounts receivable are written off as they are identified.