When Inflation Constitutes a Major Economic Problem,government Policy May Attempt

question 17

Multiple Choice

When inflation constitutes a major economic problem,government policy may attempt to

• A) shift the aggregate demand curve to the left.
• B) shift the aggregate supply curve to the left.
• C) encourage and augment spending.
• D) raise the equilibrium price level.
• E) raise the minimum wage to reduce the effective price level.

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Definitions:

Class Conflict

When the interests of one class are in opposition to those of another.

Caste System

An ascribed system of hereditary class designation.

Social Mobility

Movement between social classes.

Reincarnation

The belief, associated with Eastern religions, that one’s essence does not die and instead is reborn in another form.