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:

Legitimate

Conforming to established laws, rules, or standards, often carrying the implication of being justified or official.

Coercive

Relating to or using force or threats to persuade someone to do something or to achieve compliance.

Process

A sequence of measures or procedures executed to accomplish a specific goal.

Information

Data that is accurate and timely, specific and organized for a purpose, presented within a context that gives it meaning and relevance.