A Variable Subtracted from the Left-Hand Side of a Greater-Than-Or-Equal

question 25

Multiple Choice

A variable subtracted from the left-hand side of a greater-than-or-equal to constraint to convert the constraint into an equality is known as a(n)

• A)surplus variable.
• B)slack variable.
• C)unbounded variable.
• D)binding constraint.

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Definitions:

Negotiable

Referring to something that can be discussed or altered through negotiation, such as terms of a contract or a financial instrument.

Expansionary Gap

A situation where the total demand in an economy exceeds its potential output, leading to inflationary pressures.

Recessionary Gap

A situation in which the real GDP is lower than the potential GDP, leading to unemployment and underutilized resources.

Supply Shock

A supply shock is an unexpected event that suddenly changes the supply of a product or commodity, leading to sudden changes in its price.