The Reason the Short-Run Macro Model Suggests That the Economy

question 112

Multiple Choice

The reason the short-run macro model suggests that the economy can operate either above or below its potential while in the long-run classical model the economy operates automatically at full employment is that

• A) the short-run macro model is flawed and inaccurate
• B) the classical model is flawed and inaccurate
• C) the two models measure completely different aspects of the economy
• D) in the short run,spending affects output,but not in the long run
• E) in the short run the role of government in helping the economy return to equilibrium is not considered

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Definitions:

Delusion

A false belief or judgment, often of persecution or grandeur, that indicates an illness in the perception of reality.

Negative Symptom

A term often used in psychiatry that refers to the absence or diminution of normal functions or behaviors, such as blunted emotions or social withdrawal.

Hallucination

A perception in the absence of external stimulus that has qualities of real perception, often seen in psychiatric conditions.

Tangential Thought

A manner of speaking where an individual abruptly changes the subject without acknowledging the shift, often seen in psychiatric evaluations.