Use the following graph to answer the next question.
If the price level is initially at P1, then the economy will adjust by:
A. reducing the price level.
B. decreasing the GDP produced.
C. increasing output produced.
D. increasing the total output demanded.
Answer: C
You might also like to view...
During 2005, real GDP in Ireland grew 9.8 percent. If Ireland maintains this level of growth in the future, real GDP will double in approximately how many years?
What will be an ideal response?
The foreign exchange market is
A) a market in which exchange rates are allowed to fluctuate in the open market in response to changes in supply and demand. B) the increase in the exchange value of one nation's currency in terms of an other nation. C) a market in which households, firms, and governments buy and sell national currencies. D) the decrease in the exchange value of one nation's currency in terms of another nation.