Beginning from a Position of Long-Run Equilibrium at the Full-Employment

question 21

Multiple Choice

Beginning from a position of long-run equilibrium at the full-employment level of real GDP, the economy's short-run response to a decrease in the aggregate demand curve would be a:

• A) movement upward along the short-run aggregate supply curve.
• B) movement upward along the long-run aggregate supply curve.
• C) downward shift in the short-run aggregate supply curve.
• D) movement downward along the short-run aggregate supply curve.

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Definitions:

Cactus

A family of plants that are adapted to dry environments, known for their thick, fleshy parts used to store water.

Yucca

A genus of perennial shrubs and trees in the family Asparagaceae, known for their rosettes of evergreen, tough, sword-shaped leaves and large terminal panicles of white or whitish flowers.

Ethnography

The scientific description of the customs of individual peoples and cultures, often involving participant observation.

Typology

A classification system used to categorize objects, concepts, or people based on common characteristics.