If the Aggregate Demand Curve Shifts to the Right

question 172

Multiple Choice

If the aggregate demand curve shifts to the right,

• A)the economy is in equilibrium.
• B)people are willing to buy less real output at every price level.
• C)people are willing to buy more real output at every price level.
• D)people are willing to buy more real output at a lower price level.

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Definitions:

Profit

The profit earned when the revenue generated from a business operation surpasses all its associated expenses, costs, and taxes required for the operation.

Competitive Market

A market structure characterized by a large number of buyers and sellers, where no single participant can significantly influence price or supply.

Marginal Cost

The change in total cost that arises when the quantity produced is incremented by one unit.

Average Variable Cost

The variable cost per unit of output, calculated by dividing total variable costs by the quantity of output.