The price level is an equilibrium variable, determined by other variables. is not an equilibrium variable,...
The price level
is an equilibrium variable, determined by other variables.
is not an equilibrium variable, since we can measure it directly using a price index.
does not depend on supply and demand, since it is a macro, not a micro, number.
is measured in dollars or some other unit of account.
is “level” because it does not slope up or down as do supply and demand.
Homework Answers
Correct Answer:
B
Price level is measured using price index. It an an aggregate of price of the basket of goods and services.
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The price level
is an equilibrium variable, determined by other variables.
is not an equilibrium variable,...
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