Aggregate Demand-Aggregate Supply Analysis Shows That in the Long Run

question 61

Multiple Choice

Aggregate demand-aggregate supply analysis shows that in the long run the effect of increased aggregate spending on real GDP is:

• A)negative.
• B)close to infinity.
• C)indeterminate.
• D)zero.
• E)positive.

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Definitions:

Directly Attributable Costs

Costs that can be directly associated with a specific asset or service, and which would not have been incurred if the asset or service had not been acquired or produced.

Financial Liability

An obligation to deliver cash or another financial asset to another entity.

Legally Enforceable Right

A right that is recognized by law and can be upheld in a court.

Set Off

Set off is a legal mechanism allowing parties to mutually cancel out monetary claims against each other by offsetting debts, thereby simplifying payment processes.