Refer to the Diagram for a Specific Economy

question 74

Multiple Choice

Refer to the diagram for a specific economy. The shape of this curve suggests that

• A) the price level rises at a diminishing rate as the level of aggregate demand increases.
• B) full employment and price stability are compatible goals only when aggregate demand is falling.
• C) each successive unit of decline in the unemployment rate is accompanied by a smaller increase in the rate of inflation.
• D) each successive unit of decline in the unemployment rate is accompanied by a larger increase in the rate of inflation.

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Definitions:

Hyperpolarize

A change in a cell's membrane potential that makes it more negative, moving it further away from initiating an action potential.

Hyperpolarization

An increase in a cell's membrane potential, making the interior of the cell more negative and less likely to fire an action potential.

Plasma Membrane

The semipermeable membrane surrounding the cytoplasm of a cell, responsible for controlling the passage of substances in and out.

Gray Matter

A major component of the central nervous system consisting of neuron cell bodies, dendrites, and unmyelinated axons, associated with processing and cognition.