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Assume the Economy Is Initially in Equilibrium Where Potential GDP

question 35

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Assume the economy is initially in equilibrium where potential GDP equals real GDP.If the economy experiences a ________ demand shock and the Bank of Canada does not change its target short-term nominal interest rate,the IS curve shifts to the left and real GDP will be ________ potential GDP.


Definitions:

Sleeping Cluster

A behavior observed in some animals, including naked mole rats, where individuals sleep closely together for warmth, safety, or social bonding.

Peripheral

Relating to or situated on the edge or outer limits of something, often used to describe objects or areas that are not central or core to a main subject.

Fitness Benefit

Fitness benefits are advantages gained that increase an individual's reproductive success and chance of passing genes to the next generation.

Foraging Tactic

Strategies employed by animals to locate, capture, and consume food, which can vary widely among species based on ecological niches and food availability.

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