In the Short Run, with Predetermined Prices, When Output Is

question 106

Multiple Choice

In the short run, with predetermined prices, when output is less than planned aggregate expenditure:

• A)potential output is greater than short run equilibrium output.
• B)potential output is less than short run equilibrium output.
• C)planned investment is less than actual investment.
• D)planned investment is greater than actual investment.

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Definitions:

Supply Increases

A situation where the quantity of a good or service that producers are willing and able to offer for sale rises, due to factors like lower production costs or increased demand.

Demand Curve

An illustrated chart showing the connection between a product's price and the level of demand from buyers.

Price of Quinoa

The cost at which quinoa, a high-protein, gluten-free grain, is sold in the market.

Equilibrium Price

The price at which the quantity of goods suppliers are willing to sell equals the quantity consumers are willing to buy, also known as the market-clearing price.