Figure 27-3 -Refer to Figure 27-3.In the Dynamic Model of AD-AS in Model

question 140

Multiple Choice

Figure 27-3

-Refer to Figure 27-3.In the dynamic model of AD-AS in the figure above,if the economy is at point A in year 1 and is expected to go to point B in year 2,and no fiscal or monetary policy is pursued,then at point B

• A) the unemployment rate is very low.
• B) firms are operating at below capacity.
• C) the economy is below full employment.
• D) income and profits are falling.
• E) there is pressure on wages and prices to fall.

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Definitions:

Homo Habilis

An extinct species of early human that lived in Africa, known for using stone tools.

Neurons

Specialized cells within the nervous system that transmit information to other nerve cells, muscle cells, or gland cells, primarily through electrical and chemical signals.

New Regions

Newly explored or identified areas within a field of study or geographical locations.

Brain

The organ located in the head of vertebrates that coordinates the body's actions and reactions by transmitting signals to and from different parts of the body.