A Common Assumption Among Macroeconomists Is That When Real GDP

question 110

Multiple Choice

A common assumption among macroeconomists is that when real GDP exceeds potential output,factor prices rise and the

• A)AS curve shifts to the left.
• B)AD curve shifts to the right.
• C)AS curve shifts to the right very rapidly.
• D)AD curve shifts to the left rapidly.
• E)none of the above - the AS curve remains unchanged.

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Definitions:

Worldwide Production Efficiency

Achieved when goods and services are produced at the lowest possible cost globally, maximizing the use of resources across nations.

Wage Rates

The standard amount of pay given for work performed, often expressed on an hourly, daily, or piecework basis.

Negative Self-selection

A scenario where individuals with less favorable characteristics are more likely to choose a particular option or action.

Migration

The movement of people from one place to another, which can be within a country or across international borders, often in search of better living conditions or employment.