An Increase in Short-Run Aggregate Supply Could Be the Result

question 22

Multiple Choice

An increase in short-run aggregate supply could be the result of:

• A) an increase in the general price level.
• B) a negative supply shock.
• C) an increase in the price of oil.
• D) an increase in consumption spending.
• E) a reduction in expected future prices.

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Definitions:

Quantity Demanded

The complete quantity of a product or service that buyers are ready and able to buy at a certain price during a defined time frame.

Quantity Supplied

Quantity Supplied is the amount of a commodity that producers are willing to sell at a particular price over a certain period of time.

Equilibrium

A situation in the market where demand and supply balance out, causing prices to remain stable.

Quantity Supplied

The total amount of a good or service that producers are willing to sell at a given price over a specific period.