Consider the Basic AD/AS Model, and Suppose There Is a Negative

question 94

Multiple Choice

Consider the basic AD/AS model, and suppose there is a negative output gap. If an expansionary fiscal policy is pursued and the AS curve shifts right unexpectedly, the fiscal policy may be , and real GDP may _ _ potential GDP.

• A)too strong; rise above
• B)too weak; stay below
• C)too weak; rise above
• D)appropriate; equal
• E)too strong; stay below

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Definitions:

Personal Initiative

An individual's action that is anticipatory, self-starting, and persistent in overcoming barriers and implementing change or innovation.

Need Theories

Psychological theories that identify and categorize human needs driving behavior, often focusing on how these needs influence work motivation and management.

Process Theories

Motivation theories that specify the details of how motivation occurs.

Need Theories

Psychological theories that describe the kinds of needs that motivate human behavior, such as Maslow's hierarchy of needs.