A Rise in the Price Level

question 296

Multiple Choice

A rise in the price level

• A) increases short-run aggregate supply.
• B) decreases short-run aggregate supply.
• C) increases aggregate quantity supplied.
• D) decreases aggregate quantity supplied.
• E) decreases aggregate demand.

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Definitions:

Democracy

A form of government in which power is vested in the hands of the people and exercised by them directly or through freely elected representatives.

Morality

Principles and beliefs concerning the distinction between right and wrong or good and bad behavior.

Sixteenth Amendment

Constitutional amendment passed in 1913 that legalized the federal income tax.

Graduated Income Tax

A tax system where the tax rate increases as the taxable amount increases, imposing higher rates on higher income earners.