An Important Assumption in the AD/AS Macro Model Is That

question 11

Multiple Choice

An important assumption in the AD/AS macro model is that when real GDP is less than potential output,factor prices adjust and the

• A)AS curve shifts to the left fairly rapidly.
• B)AS curve shifts to the right only very slowly.
• C)AS curve shifts to the right very rapidly.
• D)AD curve shifts to the left rapidly.
• E)None of the above - the AS curve remains unchanged.

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Definitions:

Internal Validity

The extent to which a study or experiment can establish a causal relationship between its variables, free from confounding factors.

Control Group

A group in an experiment or study that does not receive the experimental treatment and is used as a benchmark to measure how the other tested groups do.

Unreliable Treatment Implementation

Variability or inconsistency in the application of an intervention in research or practice, potentially affecting the validity and outcomes of the study.

Statistical Conclusion Validity

The degree to which conclusions drawn from statistical analysis accurately reflect the real relationships among variables.