In Short-Run Macroeconomic Equilibrium

question 196

Multiple Choice

In short-run macroeconomic equilibrium

• A) short-run aggregate supply (SAS) equals aggregate demand (AD).
• B) the price level is stable.
• C) real GDP equals potential GDP.
• D) no one is kicking himself.
• E) all of the above are true.

---

Definitions:

Corporate Tax Rates

The percentage of corporate profits taken as tax by the government.

After-Tax Cost

The net cost of an investment or transaction after considering the effects of taxes on its overall expenses or returns.

WACC

Weighted Average Cost of Capital, a calculation of a firm’s cost of capital in which each category of capital is proportionately weighted.

Debt-Equity Ratio

A measure of a company's financial leverage, calculated by dividing its total liabilities by stockholders' equity, indicating the proportion of debt used in financing its assets.