An Output Gap with Y < Y

question 27

Multiple Choice

An output gap with Y < Y*

• A)is desirable because it keeps wage costs low.
• B)represents a loss of output due to unemployed resources.
• C)tends to force prices up.
• D)occurs when there is excess demand.
• E)is known as an inflationary boom.

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Definitions:

Hallucinations

Sensory experiences or perceptions that have no basis in reality and occur without any external stimulus.

Delirium

An acute, often fluctuating state of confusion, characterized by altered cognition, attention, and awareness.

Agnosia

A neurological condition where a person cannot interpret sensations correctly despite having normal sensory functions.

Apraxia

A motor disorder caused by damage to the brain, resulting in difficulty with executing voluntary movements despite having the desire and physical ability to perform them.