If Prices Are Completely Flexible,then a Positive Aggregate Demand Shock

question 168

Multiple Choice

If prices are completely flexible,then a positive aggregate demand shock will lead to:

• A) an immediate upward shift of the SRAS curve.
• B) an immediate downward shift of the SRAS curve.
• C) a shift of the long-run aggregate supply curve to the right.
• D) a shift of the long-run aggregate supply curve to the left.

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Definitions:

Increase Of Hazards Clause

A provision in insurance policies that allows the insurer to deny coverage if the insured significantly increases the risk or hazard insured against.

Highly Explosive Material

Substances that have a rapid and violent chemical reaction causing an explosion.

Insurance Coverage

Protection provided by an insurance policy against financial losses from specific risks or damages.

Bad Faith Breach

A situation where a contractual obligation is not fulfilled, with the violator having no intention to honor the contract from the start.