The Decrease in Short-Run Aggregate Supply During the Great Recession

question 53

Multiple Choice

The decrease in short-run aggregate supply during the Great Recession was caused by

• A) excessive consumer debt.
• B) miscalculation of the risk of subprime mortgages.
• C) the worldwide glut of savings.
• D) businesses that reduced their production capacity by closing plants and laying off workers.

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Definitions:

Acing

Excelling in a task or challenge with remarkable skill or ease, often used in the context of achieving high marks or performance.

Studying

The act of applying one's mind purposefully to the acquisition of knowledge or understanding of a subject.

Entity Theorists

Those who believe that traits are fixed, stable things (entities) and thus people should not be expected to change.

Incremental Theorists

Those who believe that traits are subject to change and improvement.