In the Short Run, an Increase in the Price Level

question 71

Multiple Choice

In the short run, an increase in the price level:

• A)decreases output prices relative to input prices.
• B)decreases the profit margins of many producers.
• C)decreases real GDP supplied.
• D)increases aggregate supply.
• E)increases output prices relative to input prices.

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Definitions:

Future Favors

A practice commonly seen in developing countries based upon mutual obligation and resulting in the exchange of favors over years and even generations; also used in some industrialized countries such as Japan and South Korea.

Inner Circle

A clique of trusted family members, tribal members, or friends (depending on the culture) who are at the center of power or influence.

Ethical Standards

Principles that govern the behavior of individuals and organizations, determining what is right and wrong.

Community Enforcer

An individual or group that ensures adherence to community norms and rules.