When the Economy's Actual Price Level Exceeds the Expected Price

question 10

Multiple Choice

When the economy's actual price level exceeds the expected price level in the short run, _____

• A) the nominal wages of workers decline.
• B) the nominal wages of workers increase.
• C) firms decrease output below the potential level.
• D) the economy produces the natural rate of output.
• E) cyclical unemployment in the economy falls to zero.

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Definitions:

Bird

A warm-blooded vertebrate characterized by feathers, beaks, and typically the ability to fly.

Primary Producer

Organisms, typically plants and algae, that produce organic compounds from carbon dioxide through photosynthesis, serving as a food source for other organisms in the ecosystem.

Plant

Multicellular organisms in the kingdom Plantae that use photosynthesis to make their own food, characterized by green pigmentation, cellulose cell walls, and reproduction via spores or seeds.

Secondary Consumer

An organism that feeds on primary consumers; typically a carnivore or omnivore that occupies the third trophic level in a food chain.