Within the AD/AS Model, If an Unanticipated Reduction in Aggregate

question 80

Multiple Choice

Within the AD/AS model, if an unanticipated reduction in aggregate demand results in less than the full-employment rate of output,

• A) the natural rate of unemployment will increase.
• B) long-run aggregate supply will increase.
• C) lower resource prices and declining interest rates will direct the economy back to full employment.
• D) higher resource prices and rising interest rates will direct the economy back to full employment.

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Definitions:

Unflattering View

An opinion or perspective that is not favorable or complimentary.

Human Reasoning

The process through which individuals draw conclusions and make decisions based on information, past experiences, and logical thinking.

Syllogism's Conclusion

The final part of a syllogism, consisting of a statement that logically follows from the two premises.

Validity

in research refers to the extent to which a tool, test, or study accurately measures what it is intended to measure.