Other Things Being Equal,as the Price Level Rises Exogenously,the Aggregate

question 100

Multiple Choice

Other things being equal,as the price level rises exogenously,the aggregate expenditure (AE) function shifts

• A)down and the economy will move upward to the left along the AD curve.
• B)down and the economy will move downward to the right along the AD curve.
• C)upward and the economy moves upward to the left along the AD curve.
• D)upward and the economy moves downward to the right along the AD curve.
• E)to the right and the AD curve will also shift to the right.

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Definitions:

Federal Trade Commission

A U.S. federal agency established in 1914 to promote consumer protection and the elimination and prevention of anticompetitive business practices.

Legal Cartel Theory

A concept where a group of firms or entities legally agree to control production, pricing, or marketing of goods and services to dominate a market.

Average Total Cost

The total cost of production (fixed and variable costs combined) divided by the number of units produced, indicative of cost per unit.

Price-fixing

An illegal agreement among competitors to set prices at a certain level, rather than letting them be determined naturally by the market.