The Growth Rate of Potential Output Might Be Decreased by an Expansionary

question 22

Multiple Choice

The growth rate of potential output might be decreased by an expansionary fiscal policy if

• A)the budget deficits are persistent.
• B)the simple multiplier is small.
• C)the policy crowds out private investment.
• D)public investment has high productivity.
• E)the composition of output is not altered.

Grasp the principles behind conformity, including the roles of group size and unanimity.

Analyze the social and psychological factors that influence conformity, including the context of ambiguity.

Examine the effects of group dynamics, such as group polarization and groupthink, on decision-making.

Understand the principles of obedience to authority, including the gradual escalation of commitments and the distribution of responsibility.

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Definitions:

Net Domestic Product

The total value of all goods and services produced within a country in a specific period, minus depreciation.

Depreciation

The process of allocating the cost of a tangible asset over its useful life, reflecting a decrease in its value over time.

Consumption

The use of goods and services by households, which is a primary component of GDP and a key indicator of the economic health of a society.

Gross Domestic Product

The total value of all goods and services produced within a country's borders during a specific time period, used as a broad indicator of economic health.