Using Figure 1 Above, If the Aggregate Demand Curve Shifts

question 101

Multiple Choice

Using Figure 1 above, if the aggregate demand curve shifts from AD2 to AD3 the result in the long run would be:

• A) P1 and Y2.
• B) P2 and Y2.
• C) P1 and Y1.
• D) P4 and Y2.

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Definitions:

Direct Labor

The expenditure on the pay of staff members directly participating in the production of goods or delivery of services.

Production Department

A division within a manufacturing company responsible for the actual production of goods.

Prior Department

Refers to the earlier stage or department in a production process or organizational structure that precedes the current focus point.

Partially Processed Product

Items that have undergone some stages of the production process but are not yet completed.