In Long- Run Macroeconomic Equilibrium

question 42

Multiple Choice

In long- run macroeconomic equilibrium,

• A) the aggregate demand curve adjusts to the point where the long- run aggregate supply curve and the short- run aggregate supply curve intersect.
• B) the real wage rate has adjusted so that the economy is on the short- run aggregate supply curve but not on the long- run aggregate supply curve.
• C) long- run aggregate supply curve has shifted so that potential GDP equals real GDP.
• D) None of the above answers is correct.

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Definitions:

Social Learning

The theory that people learn new behaviors, attitudes, and values by observing the actions and outcomes of others' behaviors.

Empathy-Altruism

A theory suggesting that feeling empathy for another person creates a motivational state aimed at enhancing that person's welfare.

Communal Orientation

A frame of mind in which people don’t distinguish between what’s theirs and what is someone else’s.

Functional Approach

A perspective in various disciplines that emphasizes the purpose and role of something rather than its composition or appearance.