A Rise in the Price Level in an Economy

question 49

Multiple Choice

A rise in the price level in an economy

• A)shifts its long-run aggregate supply curve to the right.
• B)shifts its long-run aggregate supply curve to the left.
• C)does not have any effect on its long-run aggregate supply.
• D)does not have any effect on its aggregate demand.

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Definitions:

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2008 Recession

A significant decline in economic activity spread across the economy, lasting more than a few months, which was prominently initiated in 2008 due to the collapse of the housing market and financial sector.

Economic Downturn

A period of declining economic performance across an economy, characterized by reduced GDP, employment, and spending.

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