Which of the Following Statements Is True of the Economy

question 4

Multiple Choice

Which of the following statements is true of the economy in the long run? In the long run,
I. real GDP eventually moves to potential output because all wages and prices are assumed to be flexible.
II. the economy can achieve its natural level of employment and potential output at any price level.
III. there is no cyclical unemployment.

• A) I only
• B) I and II only
• C) I and III only
• D) I, II, and III

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Definitions:

Black Workers

Individuals of African descent who are part of the workforce, highlighting their experiences, challenges, and contributions within labor markets.

Non-Hispanic White

A demographic category used in the United States to describe people who are not of Hispanic or Latino origin and who identify as having origins in any of the original peoples of Europe, the Middle East, or North Africa.

Poverty Line

The figure established by the government to indicate the amount of money needed to support the basic needs of a household.

Poverty

The state of being extremely poor, where individuals or communities lack the financial resources for basic life necessities.