If the Price Level Does Not Fall or Only Falls

question 105

Multiple Choice

If the price level does not fall or only falls very slowly, then the result will be a prolonged period of

• A)inflation whenever supply increases.
• B)production below potential GDP.
• C)production above potential GDP.
• D)rapid price increases when demand changes.

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Definitions:

One-Dimensional

Lacking depth or complexity; containing only one aspect or dimension.

Affective

Relating to moods, feelings, and attitudes; the emotional aspect of consciousness as opposed to cognitive or behavioral aspects.

Instrumental

Serving as a means or tool to achieve a desired goal or end.

Shared Language

A common mode of communication or terminology understood by a particular group or community.