When the Price Level Is Rising and Simultaneously Real GDP

question 242

Multiple Choice

When the price level is rising and simultaneously real GDP is decreasing

• A) the natural unemployment rate increases.
• B) stagflation occurs.
• C) there is an expansionary gap.
• D) the Fed has increased the discount rate.

Explain the relationship between price levels and output in the short-run.

Identify factors that cause movements along the short-run aggregate supply curve.

Describe conditions that lead to shifts in the short-run aggregate supply curve.

Analyze the impact of expectations on short-run economic outcomes.

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Definitions:

Acculturative Stress

The psychological impact of adapting to a new culture, which may involve stress due to loss of social support systems, identity confusion, and facing discrimination.

Marginalized

Describes individuals or groups that are excluded, ignored, or relegated to the outer edge of society or a community.

Original Culture

The fundamental characteristics, beliefs, and practices of a society or community that have been established over time and serve as the foundation for its current identity and social norms.

Majority Culture

The prevailing cultural practices, beliefs, and values of the dominant group in a society.