As the Macro Economy Adjusts from the Short Run to the Long

question 59

Multiple Choice

As the macro economy adjusts from the short run to the long run,

• A)wages and other factor prices remain constant.
• B)wages and other factor prices adjust to close output gaps.
• C)aggregate supply shocks cause deviations from potential output.
• D)aggregate demand shocks cause deviations from potential output.
• E)potential output is adjusting to close inflationary or recessionary gaps.

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Definitions:

Connects

Connects refers to the action of linking or joining two or more things together.

Muscle

Muscles are soft tissues in the body that contract to produce movement of body parts and maintain posture.

Bone

A rigid organ that constitutes part of the vertebrate skeleton, providing structural support and protecting various organs.

Tendon

A fibrous connective tissue that attaches muscle to bone, transmitting forces to produce movement at joints.