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Suppose That as a Result of Expectations of Lower Sales

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  Suppose that as a result of expectations of lower sales in the future,a decrease in autonomous business investment causes aggregate demand to shift from AD<sub>0</sub> to AD<sub>1</sub> as shown in Figure 10.1.Which of the following statements is true? A) According to Keynesian theory,the economy will quickly adjust back to full employment. B) According to Keynesian theory,additional decreases in aggregate demand will occur. C) In the absence of any additional decreases in investment,the equilibrium will remain at Q<sub>1</sub> indefinitely. D) The GDP gap will be eliminated by the multiplier. Suppose that as a result of expectations of lower sales in the future,a decrease in autonomous business investment causes aggregate demand to shift from AD0 to AD1 as shown in Figure 10.1.Which of the following statements is true?


Definitions:

Posttranslational Control

Regulation of gene expression that controls activity or functions of proteins, usually by phosphorylation or other chemical modifications of the protein. Compare with transcriptional-level control, translational-level control, and posttranscriptional control.

Translational Control

The regulation of protein synthesis in a cell by various mechanisms that act on the process of translating RNA into protein.

Transcriptional Control

The regulation of gene expression at the transcription stage, determining when and how much RNA is produced from a gene.

Repressible System

A regulatory system in which the presence of a specific molecule inhibits gene expression.

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