The Economy Cannot Remain Indefinitely with Real GDP Greater Than

question 92

Multiple Choice

The economy cannot remain indefinitely with real GDP greater than potential GDP because the money wage rate will

• A)increase, shifting the LAS curve leftward.
• B)decrease, shifting the SAS curve rightward.
• C)increase, shifting the SAS curve rightward.
• D)increase, shifting the SAS curve leftward.
• E)decrease, shifting the LAS curve rightward.

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Definitions:

Initial Value Method

Initial Value Method is an accounting approach where investments are recorded at their purchase cost, without subsequent adjustments for changes in fair value.

Consolidated Net Income

The total net income of a parent company and its subsidiaries after adjusting for intercompany transactions.

Intra-Entity Transfers

Transactions involving the transfer of goods, services, or resources between divisions or entities within the same company.

Operating Income

The profit realized from a business's core operations, excluding deductions of interest and taxes.