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Questions and Answers
What is the impact of lower prices according to the law of short-run aggregate supply?
What is the impact of lower prices according to the law of short-run aggregate supply?
- Create incentives for decreased production since consumers prefer lower prices
- Create incentives for increased production through higher profits
- Result in stability in the market
- Stimulate more consumer purchases (correct)
How do higher prices influence production in the short-run aggregate supply law?
How do higher prices influence production in the short-run aggregate supply law?
- Stimulate more consumer purchases
- Create incentives for increased production through higher profits (correct)
- Lead to decreased demand for goods and services
- Result in lower profits for producers
What effect do higher prices have on production according to the short-run aggregate supply law?
What effect do higher prices have on production according to the short-run aggregate supply law?
- Stimulate more consumer purchases
- Have no impact on production levels
- Lead to stability in the market
- Create incentives for decreased production since consumers prefer lower prices (correct)
Why do lower prices create incentives for increased production according to the short-run aggregate supply law?
Why do lower prices create incentives for increased production according to the short-run aggregate supply law?
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How do higher prices influence consumer behavior according to the short-run aggregate supply law?
How do higher prices influence consumer behavior according to the short-run aggregate supply law?
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