The New Keynesian Sticky-Price Theory Indicates That an Increase in Aggregate

question 23

Multiple Choice

The new Keynesian sticky-price theory indicates that an increase in aggregate demand generates

• A) a speedy rise in real GDP but a sluggish increase in the price level.
• B) a speedy rise in the price level but a sluggish increase in real GDP.
• C) sluggish increases in both real GDP and the price level.
• D) rapid increases in both real GDP and the price level.

---

Definitions:

Manage Diversity

The practice of recognizing, embracing, and leveraging differences within a group or organization to foster an inclusive environment and achieve better outcomes.

Highlighting Strength

The practice of emphasizing and showcasing the strong points or advantages of a product, service, or individual to differentiate them from competitors.

Identifying Resource

The process of recognizing and locating resources that can be utilized for a specific purpose or project.

Brand Extensions

The practice of leveraging the brand equity of an existing brand name to launch new products or services in a different category.