Suppose the Economy Was Initially in a Long-Run Equilibrium

question 268

Multiple Choice

Suppose the economy was initially in a long-run equilibrium. Then the world economy expands so that foreign incomes rise. U.S. aggregate demand ________ and eventually the money wage rate ________.

• A) increases; rises
• B) increases; falls
• C) decreases; rises
• D) decreases; falls

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Definitions:

Development

The process of growth, change, and progress in physical, social, economic, and emotional dimensions across the lifespan or within societies.

Infant

A young child in the earliest period of life, especially from birth to one year of age.

Categorize Objects

The cognitive process of grouping or classifying objects based on shared characteristics or functions.

Bayley-III

A comprehensive developmental test used for assessing the development of infants and toddlers.