An Increase in the Price Level and a Reduction in Output

question 31

Multiple Choice

An increase in the price level and a reduction in output would result from

• A)an increase in the money supply.
• B)an increase in government expenditures.
• C)a fall in stock prices.
• D)bad weather in farm states.

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Definitions:

Barter

The direct exchange of goods and services between parties without the use of money.

Electronic Entries

Transactions or records created and stored in digital form, often used in banking and bookkeeping.

Absence

The state of something being not present or lacking.

Double Coincidence

A condition in barter systems where two parties each possess an item the other wants, facilitating a direct exchange without the need for a common currency.