Which of the Following Is Consistent with an Active Approach

question 59

Multiple Choice

Which of the following is consistent with an active approach to policy?

• A)The natural rate of unemployment being uncertain
• B)Wages and prices being relatively quick to adjust
• C)The short-run aggregate supply curve being slow to shift in the presence of a recessionary gap
• D)The size of the multiplier being irrelevant
• E)The aggregate demand curve being slow to shift in the presence of a recessionary gap

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Definitions:

Capacity

The maximum amount that something can contain or produce, often used in the context of production and manufacturing facilities.

Gross Profit

The difference between revenue and the cost of goods sold before accounting for certain other costs.

Net Working Capital

The difference between a company's current assets and current liabilities, indicating the short-term liquidity of a business.

Current Assets

Assets that are expected to be converted into cash, sold, or consumed within one year or within the operating cycle of the business, whichever is longer.