In the Long Run,following a Combination of a Negative Demand

question 26

Multiple Choice

In the long run,following a combination of a negative demand shock and a temporary negative supply shock,

• A)both inflation and output return to the original long-run equilibrium values.
• B)inflation is permanently increased,while output returns to potential output.
• C)output returns to potential output,while inflation may be higher or lower than its initial value.
• D)inflation is permanently reduced,while output returns to potential output.
• E)None of the above.

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Definitions:

Superstitious Behavior

Actions or practices based on the belief in supernatural causality, where specific activities are thought to influence outcomes, despite the absence of a logical cause-and-effect relationship.

Persistent Behavior

A continuous, repeated pattern of actions or tendencies that are exhibited over time, often resisting change.

Token Economy

A form of behavior modification based on the systematic reinforcement of target behavior, through the use of tokens that can be exchanged for other rewards.

Fixed-Ratio Schedule

A reinforcement schedule in operant conditioning where a response is reinforced only after a specified number of responses have occurred.