When Economic Growth (A Gradual Shift of LRAS to the Right)

question 122

Multiple Choice

When economic growth (a gradual shift of LRAS to the right) expands the production possibilities of an economy,

• A) a higher rate of real output can be achieved in the short run, but it cannot be sustained in the long run.
• B) a larger output can be attained even if unemployment remains at its natural rate.
• C) the general level of prices will rise if the money supply is held constant.
• D) the equilibrium in the goods and services market will be disrupted.

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Definitions:

Behavior

A term that simply refers to what individuals do—their observable actions. Behavior can be verbal or nonverbal. Behavior is also one of the four components of objectives, representing the actions students undertake to indicate that they have knowledge of the content.

Reinforcement

In psychology, the process of encouraging or establishing a pattern of behavior through rewards or punishments.

Punishment

The application of an adverse stimulus or removal of a positive stimulus in response to an unwanted behavior, aiming to reduce the likelihood of the behavior's occurrence.

Behavior

The actions or reactions of an individual or system in response to external or internal stimuli.