If the Economy Is on Its Short-Run Phillips Curve at the Natural

question 52

Multiple Choice

If the economy is on its short-run Phillips curve at the natural unemployment rate, then in the AS-AD model, real GDP is definitely

• A)decreasing.
• B)greater than potential GDP.
• C)less than potential GDP.
• D)increasing.
• E)equal to potential GDP.

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Definitions:

Clairvoyance

The supposed ability to gain information about an object, person, location, or physical event through means other than the known human senses.

Precognition

The alleged psychic ability to see or know about events before they happen.

Telepathy

The claimed ability to communicate thoughts or information from one mind to another without using known sensory channels.

Psychics

Individuals who claim to possess extraordinary abilities to perceive information hidden from the normal senses, often involving telepathy or clairvoyance.