Scenario 14-1 The Economy Is in Long-Run Equilibrium. Suddenly, Due to Improved

question 38

Multiple Choice

Scenario 14-1
The economy is in long-run equilibrium. Suddenly, due to improved international relations and the increased confidence of policymakers, citizens become more optimistic about the future and stay this way for a long time.
-Refer to the Scenario 14-1.In the short run,which of the following describes the changes that take place in the economy?

• A)Both the price level and real GDP rise.
• B)Both the price level and real GDP fall.
• C)The price level rises and real GDP falls.
• D)The price level falls and real GDP rises.

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Definitions:

Hypothermic Fingers

A condition in which the fingers become extremely cold and possibly numb, often a result of prolonged exposure to cold temperatures affecting peripheral circulation.

Kussmaul's Respiration

A type of deep, labored breathing pattern associated with severe metabolic acidosis, particularly diabetic ketoacidosis.

Cheyne-Stokes

A pattern of breathing characterized by a gradual increase in depth followed by a decrease, resulting in temporary cessations of breathing typically associated with heart failure or neurological conditions.

Tachypnea

Abnormally rapid rate of breathing.