Refer to the information provided in Figure 11.1 below to answer the questions that follow. Figure 11.1
-Refer to Figure 11.1. Between the output levels of $1,000 billion and $1,500 billion, the relationship between the price level and output is
A) constant.
B) negative.
C) positive.
D) indeterminate.

Question

Refer to the information provided in Figure 11.1 below to answer the questions that follow.  Figure 11.1
-Refer to Figure 11.1. Between the output levels of $1,000 billion and $1,500 billion, the relationship between the price level and output is
A) constant. 
B) negative. 
C) positive. 
D) indeterminate.

Quizplus · Accepted Answer

Between the output levels of $1,000 billion and $1,500 billion, if the price level increases, it indicates that the economy is likely experiencing demand-pull inflation, where higher demand for goods and services leads to higher prices. This suggests a positive relationship between the price level and output in this range, as increased output is associated with higher prices.

Refer to the Information Provided in Figure 11