An Increase in the Price Level Means That a Dollar

question 102

Short Answer

An increase in the price level means that a dollar buys __________ goods and services so the value of a dollar __________.

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Definitions:

Price Ceiling

A government-imposed limit on how high a price can be charged for a product or service.

Producer Surplus

The variation between the price that sellers expect to receive for a product or service and the actual price they end up getting.

Consumer Surplus

The difference between the maximum amount that consumers are willing to pay for a good or service and the amount they actually pay.

Consumer Surplus

The benefit obtained by consumers because they are able to purchase a product for a price that is less than the maximum price that they are willing to pay.