Increases in Aggregate Demand

question 77

Multiple Choice

Increases in aggregate demand

• A)lead to increases in real interest and unemployment rates if there is considerable excess capacity in the economy.
• B)result only in inflation when the economy operates at its maximum productive capacity.
• C)may be caused by ever-greater downward pressures on prices and wages if reserve requirements are raised.
• D)may be caused by an increase in taxes.
• E)increase both inflation and the unemployment rates.

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Definitions:

Minimum Lease Payments

The least amount of payments over the lease term that the lessee is obligated to make to the lessor.

Residual Value Guarantee

An assurance provided by a party (usually lessor or seller) that guarantees a minimum future value for an asset at the end of its lease term.

Present Value

The current value of a future amount of money or stream of cash flows given a specified rate of return.

Current Ratio

A liquidity ratio that measures a company's ability to pay short-term obligations or those due within one year, calculated as current assets divided by current liabilities.