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What is the different between price effect and sales effect?
Both relate to Elasticity and Total Revenue:
a. A price effect: After a price raise, all unit sold sells at a higher price that tends to increase revenue.
b. A sales effect: After a price raise, fewer units are sold that tends to lower revenue.
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Suppose the potential level of real domestic output (Q) for a hypothetical economy is $160 and the price level (P) initially is 200. Use the following short-run aggregate supply
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