What Adjusts to Restore General Equilibrium After a Shock to the Economy

question 15

Multiple Choice

What adjusts to restore general equilibrium after a shock to the economy?

• A)the LM curve
• B)the IS curve
• C)the FE line
• D)the labour supply curve

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Definitions:

Reflexive Response

An automatic, involuntary reaction to a stimulus, not requiring conscious thought.

Environmental Events

External occurrences and phenomena in an individual's surroundings that can influence behavior, cognition, and emotions.

Innate

Inborn or natural traits, abilities, or qualities that are not acquired or learned.

Classical Conditioning

An educational method involving the frequent pairing of two cues; a response initially prompted by the second cue comes to be prompted by the first cue in isolation.