If an Economy Is Using a Medium of Exchange That

question 11

Essay

If an economy is using a medium of exchange that has an inelastic supply, how do prices change in an economic recession? Why?

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Definitions:

Conditioned Stimulus

A previously neutral stimulus that, after becoming associated with an unconditioned stimulus, eventually triggers a conditioned response.

Neutral Stimulus

A stimulus that initially produces no specific response other than focusing attention.

Unconditioned Response

An automatic, natural response to a stimulus that occurs without prior learning or conditioning.

Conditioned Stimulus

A previously neutral stimulus that, after being paired with an unconditioned stimulus, elicits a conditioned response.