12.2 Equilibrium in Aggregate Demand and Supply Analysis

question 76

Multiple Choice

12.2 Equilibrium in Aggregate Demand and Supply Analysis
AD - AS Equilibrium
-On the graph above,if output is falling,while the quantity demanded is rising,the economy may be at a point on ________.

• A)the aggregate supply curve above the aggregate demand curve
• B)the aggregate supply curve below the aggregate demand curve
• C)the aggregate demand curve above the aggregate supply curve
• D)the aggregate demand curve below the aggregate supply curve
• E)none of the above

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Definitions:

Incremental Cash Flow

The additional cash flow from taking on a new project, calculated as the difference between the project's cash flows if the project is taken versus if it is not.

Incremental Cash Flow

The additional cash flow a company receives from undertaking a new project, considering the revenue and costs involved.

Capital Budgeting

The process used by companies to evaluate major investments or expenditures on capital assets, involving the assessment of investment's expected cash flows and profitability.

Net Income

The total earnings of a company after all expenses and taxes have been deducted from revenue.