If an Economy Is on the Vertical Portion of the Aggregate

question 257

Multiple Choice

If an economy is on the vertical portion of the aggregate supply curve, then it

• A) is overheating.
• B) is at full employment.
• C) has high unemployment.
• D) is in a severe recession.

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Definitions:

Interest Rate

The expense, depicted as a percentage of the principal sum, that a borrower must bear for the borrowing of assets from a lender.

Foreign-Currency Exchange

The conversion of one country's currency into another's, a key process in international trade and investments.

Net Exports

The disparity between what a nation exports and what it imports in total.

Import Quota

A limit set by the government on the amount or cost of products allowed to be brought into a country from abroad.