When the actual price level in an economy turns out to be lower ...

[genevieve1028]

When the actual price level in an economy turns out to be lower than that expected in the short run, _____.
 a. businesses cut back production
 b. the potential output level decreases
 c. the aggregate supply curve shifts leftward
  d. the aggregate supply curve shifts rightward
  e. an expansionary gap develops

Question 2

For a given money demand curve, an increase in money supply:
 a. drives up the real interest rate.
 b. lowers the opportunity cost of holding money.
 c. decreases the quantity of money demanded.
 d. drives down the price level in an economy.
 e. contracts the total output produced in an economy.

[smrerig]

Answer to Question 1

a

Answer to Question 2

b

[genevieve1028]

Excellent

[kthug]

Gracias!