The Economy Is at Full Employment

question 33

Multiple Choice

The economy is at full employment. If aggregate demand increases,

• A)an inflationary gap is created and potential GDP increases to close the gap.
• B)an inflationary gap is created and the AS curve shifts leftward as the money wage rate rises.
• C)an inflationary gap is created and the AD curve shifts leftward.
• D)a recessionary gap is created and the AS curve shifts leftward as the money wage rate falls.
• E)a recessionary gap is created and the AS curve shifts leftward as the money wage rate rises.

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Definitions:

Collective Societies

Organizations that represent creators or owners of intellectual property, managing rights and royalties on their behalf.

Baby Boomers

The demographic cohort following the Silent Generation and preceding Generation X, typically referring to people born from 1946 to 1964 in the post-World War II baby boom.

Accepting of Diversity

The openness and willingness to understand, respect, and embrace differences among individuals, including ethnicity, gender, age, and more.

Individualistic Culture

A societal framework that emphasizes personal independence and the self over collective goals and community well-being.