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The Positive Relationship Between Short-Run Aggregate Supply and the Price

Question 293

Multiple Choice

The positive relationship between short-run aggregate supply and the price level indicates that, in the short run


A) firms produce more output as the price level falls.
B) firms produce more output as the price level rises.
C) the money wage rate increases when moving along the short-run aggregate supply curve.
D) lower price levels are more profitable for firms.

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