To Increase the Price Level the Government Could Adopt Policies

question 166

Multiple Choice

To increase the price level the government could adopt policies that

• A) increase aggregate supply and aggregate demand.
• B) decrease aggregate supply and aggregate demand.
• C) increase aggregate supply and decrease aggregate demand.
• D) decrease aggregate supply and increase aggregate demand.

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Definitions:

Bonds

Financial securities that represent a loan made by an investor to a borrower, typically corporate or governmental, which pays interest over time and returns the principal at maturity.

Forgoing Benefits

The benefits that are lost when choosing one alternative over another; also known as opportunity cost.

Present Benefits

Advantages or positive outcomes that are received or enjoyed currently, as opposed to in the future.

Future Benefits

Projected advantages or positive outcomes expected to be received in the future.