Assuming That the Economy Is in the Long Run Equilibrium

question 171

Multiple Choice

Assuming that the economy is in the long run equilibrium at full employment, an expansionary monetary policy _______ the price level and _______ output.

• A) increases; doesn't change
• B) increases; increases
• C) doesn't change; doesn't change
• D) decreases; increases

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Definitions:

Compliance

The act of conforming to a request or command, often used in legal and regulatory contexts to denote adherence to rules or standards.

Internalization

The process of integrating beliefs, values, standards, or norms into one's own cognitive structure, often influencing behavior.

Identification

Refers to the process by which individuals associate themselves with particular groups, causing those groups' values and norms to become integrated into their own self-concept.

Socialization

The process by which individuals learn and adopt the values, behaviors, and norms of a society or group.