Suppose the Economy Is in a Short-Run Equilibrium and Actual

question 275

Multiple Choice

Suppose the economy is in a short-run equilibrium and actual output is greater than potential output. The economy is in:

• A) an inflationary gap; nominal wages will increase and SRAS will shift to the left until actual GDP is equal to potential GDP in the long run.
• B) a recessionary gap; nominal wages will decrease and AD will shift to the left until actual GDP is equal to potential GDP in the long run.
• C) an inflationary gap; prices of goods will increase and AD will shift to the right until the economy is in long-run equilibrium.
• D) a recessionary gap; prices of goods will decrease and LRAS will shift to the left until the economy is in long-run equilibrium.

Understand Horney’s contribution to psychoanalytic therapy and her disagreement with Freud’s therapeutic approach.

Analyze the effectiveness of psychoanalytic therapy through specific case examples.

Grasp Horney’s challenge to Freud’s views on gender envy and her contributions to feminist psychology.

Understand the physical characteristics and care requirements of different types of ostomies and urinary diversions.

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Definitions:

Inventory Holding Gain

An increase in the value of inventory over time, typically due to inflation or increased demand, before the inventory is sold.

FIFO Earnings

The net income calculated using the First-In, First-Out method of inventory valuation, assuming the first items purchased are the first sold.

Inventory Units

Inventory units are the measurable quantities of goods or materials on hand, stored or processed by a business, intended for sale or production.

Goods Available

The total quantity of goods on hand for sale during a specific period, including both beginning inventory and purchases made.