There Is an Increase in Aggregate Demand, and Firms Do

question 42

Multiple Choice

There is an increase in aggregate demand, and firms do not have sufficient capital and labor to support an output increase. In this case, inventory stocks will

• A) continue to fall, and there will be a large increase in the price level.
• B) continue to increase, and there will be a large increase in the price level.
• C) continue to fall, and the price level will fall.
• D) remain unchanged, and the price level will remain unchanged.

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Definitions:

Physical Force

The application of power, strength, or energy upon an object or body, causing it to change its velocity or shape.

Bodily Injury

Physical harm or damage to a person's body as opposed to damage to property or reputation.

Expectation of Trust

The anticipation or belief that one can rely on someone else's actions or words as being honest or fulfilling obligations.

Subpoena Duces Tecum

Court process initiated by a party in litigation, compelling production of specific documents and other items, and material in relevance to facts at issue in pending judicial proceedings.