In the Medium Run, a Fiscal Expansion That Causes an Increase

question 39

Multiple Choice

In the medium run, a fiscal expansion that causes an increase in the budget deficit will affect which of the following?

• A) Only the composition of output.
• B) The level of output but not its composition.
• C) The level of employment but not its composition.
• D) Both the level and composition of output.
• E) Both the level and composition of employment.

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Definitions:

External Locus of Control

A belief system where individuals perceive that their lives are controlled by external factors beyond their control.

Social Support

The perception or reality of assistance and emotional sustenance provided by others, which can promote psychological well-being and physical health.

Self-control Energy

The concept that self-control or willpower draws upon a limited pool of mental resources that can be used up, leading to decreased ability to control impulses or behaviors.

Oxytocin Levels

The concentration of the hormone oxytocin within the bloodstream, often associated with bonding, social behaviors, and stress reduction.