How Does the Aggregate Demand and Supply Model Reflect a Decrease

question 175

Multiple Choice

How does the aggregate demand and supply model reflect a decrease in taxes?

• A) Consumption increases,so aggregate demand shifts right.
• B) Consumption increases,so aggregate supply shifts right.
• C) Consumption decreases,so aggregate demand shifts left.
• D) Consumption decreases,so aggregate supply shifts left.

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Definitions:

Manufacturing Margin

The difference between the sales revenue of manufactured goods and the direct costs associated with producing them.

Contribution Margin

The difference between the sales revenue of a product and its variable costs, used to cover fixed costs and generate profit.

Absorption Costing

A costing technique that incorporates all costs associated with production, including both fixed and variable expenses, into the product's price.

Income Increase

A rise in the amount of money earned from various sources, including work, investments, or business operations.