Figure 35-1

question 74

Multiple Choice

Figure 35-1.The left-hand graph shows a short-run aggregate-supply (SRAS) curve and two aggregate-demand (AD) curves.On the right-hand diagram,U represents the unemployment rate.
-Refer to Figure 35-1.Assuming the price level in the previous year was 100,point G on the right-hand graph corresponds to

• A)point A on the left-hand graph.
• B)point B on the left-hand graph.
• C)point C on the left-hand graph.
• D)point D on the left-hand graph.

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Definitions:

Utility Function

A mathematical representation describing how consumers rank different bundles of goods based on the level of satisfaction they provide.

Marginal Utility

The extra pleasure or benefit derived from the consumption or utilization of an additional unit of a product or service.

Marginal Utility

The additional satisfaction or usefulness obtained from acquiring or consuming one more unit of a good or service.

Risk Averse

A characteristic of individuals who prefer to avoid risk, choosing certainty over uncertainty even if it results in a potentially lower return.