In the New Classical Model

question 24

Multiple Choice

In the new classical model,

• A)wages and prices are sticky with respect to expected changes in the price level.
• B)a rise in the expected price level results in an immediate and equal rise in wages and prices.
• C)an anticipated increase in the money supply will increase aggregate output temporarily.
• D)unanticipated policy has no effect on aggregate output and unemployment.

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Definitions:

Remobilization

The process by which sedimentary deposits are eroded and transported to be deposited again in a new location.

Pressure Solution

A diagenetic process where mineral grains partially dissolve under high stress, typically in wet conditions, allowing deformation.

Regional Metamorphism

The process of transformation of rocks by heat and pressure over wide areas of the Earth's crust, typically associated with mountain building.

Low Pressure

A condition in the atmosphere where the air pressure is lower than the surrounding area, often leading to cloud formation and precipitation.