Question

When the price level rises from 110 to 115, the aggregate level of GDP supplied rises from $80 billion to $120 billion. This ________ relationship represents the ________ relationship between the quantity of real GDP firms are willing to supply and the price level.

Answer 1

Answer: positive ; short run

Explanation: In accordance to the law of supply, The quantity of goods supply increases as the price of the goods or services as firms tends to make the most the increase in price. This highlights a positive relationshio between piece and supply. The relationship is a short run relationship which es depicted by an upward sloping curve which lies above the variable cist curve within the curve if the marginal cost.