Which Statement Is Consistent with the Short-Run Economic Theories Studied

question 46

Multiple Choice

Which statement is consistent with the short-run economic theories studied?

• A) In the short run, output is determined by the amount of capital, labour, and technology; the interest rate adjusts to balance the supply and demand for money; and the price level adjusts to balance the supply and demand for loanable funds.
• B) In the short run, output is determined by the amount of capital, labour, and technology; the interest rate adjusts to balance the supply and demand for loanable funds; and the price level adjusts to balance the supply and demand for money.
• C) In the short run, output responds to the aggregate demand for goods and services; the interest rate adjusts to balance the supply and demand for money; and the price level is stuck.
• D) In the short run, output responds to the aggregate demand for goods and services; the interest rate adjusts to balance the supply and demand for loanable funds; and the price level adjusts to balance the supply and demand for money.

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Definitions:

Approaches

Various methods or strategies used in a particular field or discipline to address issues or solve problems.

Frederick Taylor

An American mechanical engineer who sought to improve industrial efficiency and is considered the father of scientific management, proposing that by optimizing and simplifying jobs, productivity would increase.

Scientific Management

A theory in management that analyzes and synthesizes workflows to improve economic efficiency, especially labor productivity.

Worker Productivity

The measure of the efficiency of a worker or group of workers in converting inputs into useful outputs.