If Potential Output Exceeds Actual Output, the Economy

question 153

Multiple Choice

If potential output exceeds actual output, the economy:

• A)is experiencing an inflationary gap.
• B)is experiencing a recessionary gap.
• C)may be in a long-run equilibrium but is not in a short-run equilibrium.
• D)is in neither a short-run nor long-run equilibrium.

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Definitions:

Kurt Lewin

is known as the father of modern social psychology, who developed theories on group dynamics and organizational development.

Force Field Analysis

A method developed by Kurt Lewin to analyze the factors that support or hinder a particular situation or desired change by identifying and evaluating driving and restraining forces.

Resisting Forces

Factors that oppose or hinder change within an organization or system, making transformation efforts challenging.

Resistance To Change

The opposition or pushback from individuals or groups when they perceive that a change being introduced threatens their status quo or comfort zone.