The Aggregate Supply Curve Relating the Price Level to Real

question 74

Multiple Choice

The aggregate supply curve relating the price level to real GDP has three distinguishing segments. Which one of the following indicates the segments?

• A) The horizontal segment reflects increasing pressure on the price level as firms bid for resources. The upward-sloping segment reflects the availability of unused resources. The vertical segment reflects the full employment of all resources.
• B) The horizontal segment reflects the availability of unused resources. The upward-sloping segment reflects the full employment of all resources. The vertical segment reflects increasing pressure on the price level as firms bid for resources.
• C) The horizontal segment reflects the full employment of all resources. The upward-sloping segment reflects increasing pressure on the price level as firms bid for resources. The vertical segment reflects the availability of unused resources.
• D) The horizontal segment reflects the availability of unused resources. The upward-sloping segment reflects increasing pressure on the price level as firms bid for resources. The vertical segment reflects the full employment of all resources.

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Definitions:

Less Important

Refers to elements or aspects deemed as having lower priority or significance than others in a specific context.

Many Goals

The presence of multiple objectives or aims that an individual or organization seeks to achieve.

Peer Pressure

The influence exerted by a peer group, encouraging individuals to change their attitudes, values, or behaviors to conform to group norms.

Groupthink

A psychological phenomenon in which the desire for harmony or conformity in a group results in an irrational or dysfunctional decision-making outcome.