If the Economy Is in the Vertical Portion of the AS Curve,what

question 78

Multiple Choice

If the economy is in the vertical portion of the AS curve,what will be the effect on an increase in the price level on the level of employment?

• A)There will be substantial increase in employment
• B)There will be a less than proportional increase in employment
• C)There will be no change in employment
• D)Cannot be predicted from the information given

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Definitions:

Direct Labor

The wages and other costs for labor directly involved in the production of goods or provision of services.

Weighted Average Method

An inventory valuation method where costs of goods sold and ending inventory are determined by taking the weighted average of all units available for sale during the period.

Work in Process Inventory

Inventory that includes goods that are in the production process but are not yet complete.

Equivalent Units

A concept used in process costing that converts partially completed units into a number of fully equivalent units.