Economic Policies Are Effective at Changing Output When

question 104

Multiple Choice

Economic policies are effective at changing output when

• A) the economy is not producing at capacity.
• B) the economy is producing at its potential output.
• C) the unemployment rate is at the natural rate.
• D) the aggregate supply curve is vertical.

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Definitions:

Long-Term Investments

Assets that are more than 1 year old and are carried on the balance sheet at cost or book value with no appreciation.

Stocks

Shares of ownership in a company that represent a claim on the company's earnings and assets, which can be bought and sold in the stock market.

Bonds

The connections with family, friends, and others who have a similar cultural background or ethnicity.

Balance Sheet

A financial statement that reports a company's assets, liabilities, and shareholders' equity at a specific point in time.