According to the Theory of Economic Fluctuations, Which of the Following

question 10

Multiple Choice

According to the theory of economic fluctuations, which of the following explains the relationship between aggregate demand and employment during an economic expansion?

• A)Workers decide they have more leisure time than they prefer.As a result they decide to work more, causing more labor to be employed.This causes an increase in production.
• B)An increase in aggregate demand causes real GDP to increase as firms adjust their production.More workers are hired as a result.
• C)An increase in output causes potential GDP to decrease.This causes employment to increase.
• D)A decrease in real GDP causes aggregate demand to increase.As a result, firms hire more workers.
• E)An increase in aggregate demand causes potential GDP to increase.The resulting increase in output causes employment to increase.

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Definitions:

Substitution Reaction

A chemical reaction in which an atom or group of atoms in a molecule is replaced by another atom or group of atoms.

Mechanism

The detailed process by which a chemical reaction occurs, at the level of molecular structure.

Protic Solvents

Solvents that have hydrogen atoms capable of forming hydrogen bonds, often used in reactions requiring proton transfer.

Alkenes

Hydrocarbons containing at least one carbon-carbon double bond, characterized by their unsaturated nature.