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:

Operating Earnings

Operating earnings refer to the profit a company makes from its normal business operations, excluding non-operating income and expenses.

Depreciation Expense

An accounting method of allocating the cost of a tangible or physical asset over its useful life to account for declines in value.

Half-Year Convention

The half-year convention is a method in depreciation accounting where an asset is assumed to have been in service for half the year, regardless of when it was actually acquired during the fiscal year.

Incremental Depreciation

The additional depreciation expense recorded when there is a change in the estimated useful life or salvage value of an asset.