Choose the Statement That Is Incorrect

question 22

Multiple Choice

Choose the statement that is incorrect.

• A)In a deflation, the inflation rate is positive but decreasing in consequent years.
• B)In a deflation, the price level persistently falls.
• C)A one-time fall in the price level occurs when there is an increase in capital that increases potential GDP.
• D)A one-time fall in the price level occurs either because aggregate demand decreases or because short-run aggregate supply increases.
• E)A one-time fall in the price level is not a deflation.

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Definitions:

Incompetence

A lack of necessary skills or abilities to perform a task or duty effectively.

Reality

The state of things as they actually exist, as opposed to an idealistic or notional idea of them.

Perception

The way in which something is regarded, understood, or interpreted by the mind.

Multiple Causality

The concept that an event or phenomenon can be caused by more than one factor or reason.