​The Figure Given Below Shows Short Run and Long Run

question 90

Multiple Choice

​The figure given below shows short run and long run equilibrium in an aggregate demand-aggregate supply model.The economy shown in this figure is: ​
Figure 15.5
​

• A)in a long-run equilibrium at the price level P and income level Y.
• B)in a short-run equilibrium at the price level P and income level Y.
• C)experiencing a contractionary gap at price level P and income level Y.
• D)experiencing an expansionary gap at price level P" and income level Y'.
• E)in a short-run equilibrium at the price level P' and income level Y.

---

Definitions:

SQ × AP

The standard quantity times actual price formula, used in cost accounting to calculate the variance between the actual cost and the standard cost of raw materials.

Direct Materials Price Variance

The difference between the actual cost and the standard cost of direct materials used in production, indicating how effectively the materials budget is being adhered to.

Per-Unit Standards

Estimates of the direct materials, direct labor, and manufacturing overhead costs required to produce one unit of a product.

Direct Labor Price Variance

The difference between the actual cost of direct labor and the expected (or standard) cost of direct labor used during production.