An Increase in Aggregate Demand Causes an Increase in ________

question 22

Multiple Choice

An increase in aggregate demand causes an increase in ________ only in the short run,but causes an increase in ________ in both the short run and the long run.

• A)the price level; real GDP
• B)real GDP; real GDP
• C)the price level; the price level
• D)real GDP; the price level

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Definitions:

Credit Scoring

A system used by lenders to evaluate the creditworthiness of potential borrowers, resulting in a score that predicts the likelihood of repayment.

Probability of Default

The probability that a borrower will fail to fulfill their debt responsibilities.

Credit Policy

The guidelines a company follows to determine the amount and terms of credit to extend to customers.

5 C's of Credit

Refers to the five key elements a lender considers when assessing the creditworthiness of a potential borrower: character, capacity, capital, collateral, and conditions.