Many Economists Think That, in the Long Run, the Economy

question 89

Multiple Choice

Many economists think that, in the long run, the economy tends to move toward

• A)the natural or full-employment rate of unemployment.
• B)the natural or full-employment rate of inflation.
• C)a severe slump with high unemployment.
• D)an accelerating rate of inflation.

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Definitions:

Adjusting Entry

An accounting journal entry made at the end of an accounting period to allocate income and expenditure to the appropriate period.

Trading Portfolio

A collection of financial assets such as stocks, bonds, commodities, currencies, and derivatives held by an investor, primarily for the purpose of short-term speculation.

Stock Transactions

Activities involving the buying, selling, or issuing of shares of stocks in a company, either through exchanges or over-the-counter markets.

Stock Investments

A financial asset purchased in a corporation with the expectation of earning a return through dividends, stock price appreciation, or both.