Suppose an Economy Is Operating with an Inflationary Gap

question 131

Multiple Choice

Suppose an economy is operating with an inflationary gap. In this case, policymakers would
Seek to move the economy

• A) back down the Phillips curve toward an unemployment rate that is closer to the natural rate of unemployment.
• B) up the Phillips curve toward an unemployment rate that is closer to the natural rate of unemployment.
• C) back down the Phillips curve toward an unemployment rate that is further from the natural rate of unemployment.
• D) up the Phillips curve toward an unemployment rate that is further from the natural rate of unemployment.

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Definitions:

Dialectical Behavioral Therapy

A type of cognitive-behavioral therapy that emphasizes the psychosocial aspects of treatment, focusing on the importance of a therapeutic relationship, acceptance, and understanding.

Serotonin Reuptake Inhibitors

A class of drugs that are typically used as antidepressants in the treatment of major depressive disorder and anxiety disorders by increasing serotonin levels in the brain.

Obsessive-compulsive Personality Disorder

A personality disorder characterized by a preoccupation with orderliness, perfectionism, and mental and interpersonal control, at the expense of flexibility, openness, and efficiency.

DSM-5 Dimensions

The dimensional model of pathology outlined in the Diagnostic and Statistical Manual of Mental Disorders, Fifth Edition, describing various aspects of mental disorders, including severity, duration, and impact on functioning.