An Economic Expansion Caused by a Shift in Aggregate Demand

question 41

Multiple Choice

An economic expansion caused by a shift in aggregate demand causes prices to

• A)rise in the short run,and rise even more in the long run.
• B)rise in the short run,and fall back to their original level in the long run.
• C)fall in the short run,and fall even more in the long run.
• D)fall in the short run,and rise back to their original level in the long run.

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Definitions:

Rebate

A partial refund given to someone who has paid too much for tax, rent, or a utility.

Mailbox Rule

The mailbox rule is a legal principle that an offer is considered accepted once the acceptance is properly placed in the mail, even if it is lost or delayed.

Effective Upon Dispatch

Effective upon dispatch refers to the principle that certain actions, such as the sending of a notification or document, are considered effective from the moment they are sent, not when they are received.

Reasonable Expectation

refers to what an average person might foresee or predict as a likely outcome under certain circumstances, often used as a standard in legal and ethical considerations.