Suppose Aggregate Demand Increases by More Than Expected

question 152

Multiple Choice

Suppose aggregate demand increases by more than expected. Which of the following describes what will occur?

• A) Real GDP will be greater than potential GDP.
• B) The price level will increase.
• C) Unemployment will fall.
• D) All of the above answers are correct.

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Definitions:

Mean

The average of a set of numbers, calculated by summing all the numbers and then dividing by the count of those numbers.

Right-Skewed

A description of a distribution of data where the tail on the right side of the histogram is longer or fatter than the left side, indicating that the mean is greater than the median.

Standard Deviation

A measure of the amount of variation or dispersion of a set of values, indicating how much the values in the data set deviate from the mean.

Mean

A measure of central tendency that is calculated by dividing the sum of all values in a dataset by the number of values.