If Aggregate Demand Decreases, And, as a Result, Real Output

question 224

Multiple Choice

If aggregate demand decreases, and, as a result, real output and employment decline but the price level remains unchanged, it is most likely that

• A)the money supply has declined.
• B)the price level is inflexible downward and a recession has occurred.
• C)cost-push inflation has occurred.
• D)productivity has declined.

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Definitions:

Cyan

A greenish-blue color, one of the primary subtractive colors used in color printing and photography.

Septum

A partition separating two chambers, such as in the heart or nose, that is typically made of muscle or bone.

Anterior Nares

The technical term for the nostrils, which are the external openings of the nasal cavity.

Rhinorrhea

The medical term for a runny nose, characterized by the excessive discharge of mucus from the nose.