The Economy Cannot Remain Indefinitely with Real GDP Greater Than

question 109

Multiple Choice

The economy cannot remain indefinitely with real GDP greater than potential GDP because the money wage rate will

• A)decrease, shifting the LAS curve rightward.
• B)decrease, shifting the SAS curve rightward.
• C)increase, shifting the LAS curve leftward.
• D)increase, shifting the SAS curve leftward.
• E)increase, shifting the SAS curve rightward.

Recognize key international and regional organizations and agreements influencing global trade.

Identify and explain the goals and impacts of major trade agreements such as NAFTA.

Understand methods and principles of European integration.

Comprehend the concept and implications of economic and monetary union in the EU.

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Definitions:

Market Share

The share of the market held by a specific company or product, typically represented as a percentage of the overall sales in that industry.

Oligopoly

A market structure characterized by a small number of firms that control a large majority of the market share, often leading to limited competition.

Pure Monopoly

A pure monopoly is a market structure where a single seller controls the entire supply of a product or service, and where the entry of new competitors is completely blocked.

Purely Competitive Industry

An economic setup where numerous purchasers and vendors exist, entry and exit are unrestricted, and the product offered is identical across sellers.