If the Economy Is Experiencing an Inflationary Output Gap,the Adjustment

question 136

Multiple Choice

If the economy is experiencing an inflationary output gap,the adjustment process operates as follows:

• A)Wages do not adjust,but the AD curve shifts to the right.
• B)Wages fall,unit costs fall,and the AD curve shifts rightward.
• C)Wages rise,unit costs rise,and the AS curve shifts leftward.
• D)Wages rise,unit costs rise,and the AS curve shifts rightward.
• E)Wages fall,unit costs fall,and the AS curve shifts rightward.

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Definitions:

Ethnic Majority

The group within a given population or society that comprises the majority of members sharing the same cultural, linguistic, or racial background.

Social Learning View

The theory that suggests people develop prejudice and stereotypes about members of various groups in the same way they learn other attitudes, beliefs, and values.

Prejudicial Attitudes

Biased opinions or feelings against a person or group without sufficient knowledge, often leading to unfair treatment.

Stereotyping

The act of assigning oversimplified or generalized characteristics to a group of people, ignoring individual differences.