If Prices of Goods and Services Were Inflexible, Then

question 195

Multiple Choice

If prices of goods and services were inflexible, then

• A)a negative demand shock would lead to increased real GDP in the short run.
• B)a positive demand shock would lead to increased real GDP in the short run.
• C)a negative demand shock would have no short-run effect on real GDP.
• D)there would be no short-run demand shocks.

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Definitions:

Zinnia

A genus of plants within the sunflower tribe, known for their vibrant flowers and commonly grown in gardens for decorative purposes.

Marigold

A plant belonging to the genus Tagetes, known for its vibrant yellow and orange flowers, often used in gardening and as a natural pest deterrent.

Labor Force Growth

The expansion in the number of individuals available and seeking employment within an economy.

Immigration

The action of coming to live permanently in a foreign country.