An Economy Is Operating at Long-Run Equilibrium

question 1

Multiple Choice

An economy is operating at long-run equilibrium. What is the MOST likely result of an aggressive expansionary fiscal policy?

• A) no change in long-run GDP and employment
• B) a decrease in the unemployment rate
• C) a decrease in prices
• D) a rise in long-run employment

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Definitions:

Milgram Experiment

A psychological experiment conducted by Stanley Milgram in the 1960s to study obedience to authority, where participants were instructed to administer electric shocks to another person.

Stanford University Prison Experiment

A psychological study conducted by Philip Zimbardo in 1971 at Stanford University, where students were assigned roles of prisoners and guards to explore the effects of perceived power.

Generalization

Drawing a conclusion about a certain characteristic of a population based on a sample from it.

Logical Support

The provision of reasons or evidence to justify a claim or argument.