Which of the Following Affected Aggregate Demand During the Recession

question 37

Multiple Choice

Which of the following affected aggregate demand during the recession of 2008-2009?

• A)a decline in residential construction and a decrease in lending
• B)a decline in residential construction but not a decrease in lending
• C)a decrease in lending but not a decline in residential construction
• D)neither a decrease in residential construction nor a decrease in lending

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Definitions:

Optimal Order Size

The quantity that minimizes the total cost of inventory, including holding and ordering costs.

Annual Inventory Cost

The total cost associated with storing and maintaining a company's inventory over one year, including warehousing and insurance.

Maximum Inventory Level

The highest amount of inventory a business can hold to efficiently meet customer demand while minimizing holding costs.

Setup Cost

The expenses incurred to prepare and equip a process, production line, or machine to manufacture a new product batch or order.