Prior to the 1970s, the Model of Choice Was the Aggregate

question 90

Multiple Choice

Prior to the 1970s, the model of choice was the aggregate expenditures model. According to
This model, if the economy was in equilibrium at an income greater than the full employment level, then the primary economic problem would be

• A) excessive bank lending.
• B) potential crises in financial markets.
• C) inflation.
• D) excess aggregate demand.

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Definitions:

Short-term Memory

A capacity for holding a small amount of information in an active, readily available state for a short period.

Working Memory

A cognitive system responsible for temporarily holding information available for processing, essential for reasoning and guidance of decision-making and behavior.

Recognition

The cognitive process of identifying and acknowledging something as having been previously seen, heard, known, or experienced.

Recall

The act of retrieving information or events from the past in the absence of an explicit cue.