The model of aggregate demand and aggregate supply explains the relation between
A)price and quantity of a particular good.
B)unemployment and real output.
C)wages and unemployment rate.
D)real GDP and the price level.

Question

Quizplus · Accepted Answer

The model of aggregate demand and aggregate supply explains the relation between the overall price level (as measured by the GDP deflator or other indicators) and the real output level of the economy (as measured by real GDP). It shows how changes in factors like consumer spending, investment, government spending, and net exports can affect both the price level and the quantity of output produced in the economy.

The Model of Aggregate Demand and Aggregate Supply Explains the Relation