If the Economy Experiences Simultaneous Negative Aggregate Demand and Aggregate

question 46

Multiple Choice

If the economy experiences simultaneous negative aggregate demand and aggregate supply shocks,and the Fed decides to intervene with expansionary policy.Aggregate demand will eventually shift back to the right,which will eventually bring the economy

• A) back to potential GDP at a lower price level.
• B) back to potential GDP at a higher price level.
• C) back to the original equilibrium price at a lower level of aggregate output.
• D) back to the original equilibrium price at a higher level of aggregate output.

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Definitions:

Alfred Binet

A French psychologist best known for his role in developing the first intelligence tests along with his colleague Théodore Simon.

Heredity

The passing of genetic traits from parents to offspring, determining certain characteristics of the individual.

Intelligence

The ability to learn from experience, adapt to new situations, understand and handle abstract concepts, and use knowledge to manipulate one's environment.

Identical Twins

Twins that originate from a single fertilized egg, sharing the same genetic material and typically having very similar appearances.