A Difference Between the Economic Long Run and the Short

question 116

Multiple Choice

A difference between the economic long run and the short run is that:

• A) the classical dichotomy holds in the short run but not in the long run.
• B) monetary and fiscal policy affect output only in the long run.
• C) demand can affect output and employment in the short run, whereas supply is the ruling force in the long run.
• D) prices and wages are sticky in the long run only.

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Definitions:

Payable Account

An accounting record that shows the total amount of money owed to creditors for goods, services, or loans provided.

Employee Health Insurance

An insurance coverage that provides benefit payments for healthcare services to employees, often paid for wholly or in part by employers.

Retirement Program

A financial plan that provides income to individuals after they have ceased working, often involving contributions from both the employer and employee.

Gross Salary

The total earnings of an employee before any deductions like taxes and retirement contributions.