Which of the Following Is Not an Assumption Made by the Dynamic

question 14

Multiple Choice

Which of the following is not an assumption made by the dynamic model of aggregate demand and aggregate supply?

• A)Potential GDP increases continuously.
• B)Aggregate demand shifts to the right during most periods.
• C)Aggregate supply shifts to the right except during periods when workers and firms expect higher wages.
• D)Aggregate demand and potential GDP decrease continuously.

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Definitions:

Net Income

The total profit of a company after all expenses and taxes have been deducted from revenue, also known as the bottom line.

Private Corporation

A company owned by non-governmental organizations or a relatively small number of shareholders or company members which does not offer or trade its company stock (shares) to the general public.

Stockholders' Equity

The residual interest in the assets of a corporation that remains after deducting its liabilities, representing shareholders' ownership in the company.

Public Markets

Marketplaces, whether physical or electronic, that are accessible to the public for the buying and selling of securities, commodities, and other goods.