Asked by Thomas Ramirez on May 19, 2024
Verified
A federal policy that leads to an increase in aggregate supply is likely to result in:
A) lower levels of employment.
B) an increase in aggregate demand.
C) a higher price level.
D) lower levels of real GDP.
E) an economic expansion.
Aggregate Supply
The overall provision of goods and services that businesses in an economic setup aim to sell during a certain period.
Economic Expansion
A period characterized by increased business activity and growth in the economy's overall output.
Aggregate Demand
The cumulative request for every type of good and service within an economy across different pricing points, throughout a particular timeframe.
- Identify the effects of monetary strategies on the balance of price levels and production levels within an economic system.
- Understand the consequences of supply-side economic policies, focusing on how tax reductions influence overall supply levels.
Verified Answer
FK
fariana kashemMay 23, 2024
Final Answer :
E
Explanation :
A federal policy that leads to an increase in aggregate supply will increase the availability of goods and services in the economy, which will lead to a decrease in prices and an increase in real GDP. This increase in production and availability of goods and services will also stimulate economic expansion.
Learning Objectives
- Identify the effects of monetary strategies on the balance of price levels and production levels within an economic system.
- Understand the consequences of supply-side economic policies, focusing on how tax reductions influence overall supply levels.