For Those Who Favor an Active Approach,public Policy Changes Are

question 104

Multiple Choice

For those who favor an active approach,public policy changes are necessary to cure a recessionary gap because:

• A)the short-run aggregate supply curve will otherwise shift quickly to the right.
• B)prices and wages are flexible downward but not upward.
• C)the required decrease in output can be achieved only by shifting the aggregate demand curve.
• D)real wages must fall in order to increase aggregate supply in the economy.
• E)falling money wages will cause the AD curve to shift leftward unless policy counters this movement.

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Definitions:

Inability

The lack of skill, means, or capacity to perform a specific task or action.

Circadian Rhythm

The natural, internal process that regulates the sleep-wake cycle and repeats roughly every 24 hours.

Body Temperatures

The measure of the body's internal thermal state, critical for maintaining metabolic processes.

Night

The period of darkness in each twenty-four hours; the time from sunset to sunrise.