If the Economy Diverges from Its Full-Employment Output, New Classical

question 135

Multiple Choice

If the economy diverges from its full-employment output, new classical economics would suggest that

• A)a change in the velocity of money would be all that is needed to return it to its full-employment output.
• B)an improvement in insider-outsider relationships is all that is needed to return it to its full-employment output.
• C)an efficiency wage in the economy would return it to its full-employment output.
• D)internal mechanisms within the economy would automatically return it to its full-employment output.

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Definitions:

Technological Changes

Alterations or improvements in technology, processes, or methodologies that can increase efficiency, productivity, or bring new products and services.

Skilled Labor

Refers to workers who have specialized training, education, or expertise that increases their productivity and value to employers.

Business Manager

is a professional responsible for planning, directing, and overseeing operations and fiscal health of a business unit, division, department, or an operating unit within an organization.

Performance Evaluations

The systematic assessment of an employee's job performance and productivity, often influencing promotions and salary adjustments.