The table gives the aggregate demand and aggregate supply schedules for a nation.
-Refer to the table above.If the price level is 90,then the price level will ________ because ________.
A)rise;the aggregate quantity demanded is less than the aggregate quantity supplied
B)fall;the aggregate quantity demanded is greater than the aggregate quantity supplied
C)fall;the aggregate quantity demanded is less than the aggregate quantity supplied
D)rise;the aggregate quantity demanded is greater than the aggregate quantity supplied
E)either fall or rise;markets are unstable and macroeconomic equilibrium is difficult to predict

Question

The table gives the aggregate demand and aggregate supply schedules for a nation.
-Refer to the table above.If the price level is 90,then the price level will ________ because ________.
A)rise;the aggregate quantity demanded is less than the aggregate quantity supplied 
B)fall;the aggregate quantity demanded is greater than the aggregate quantity supplied 
C)fall;the aggregate quantity demanded is less than the aggregate quantity supplied 
D)rise;the aggregate quantity demanded is greater than the aggregate quantity supplied 
E)either fall or rise;markets are unstable and macroeconomic equilibrium is difficult to predict

Quizplus · Accepted Answer

The price level will rise because when the aggregate quantity demanded is greater than the aggregate quantity supplied, there is upward pressure on prices.

The Table Gives the Aggregate Demand and Aggregate Supply Schedules