If the Economy Begins at Full Employment and Then Aggregate

question 101

Multiple Choice

If the economy begins at full employment and then aggregate demand decreases,

• A) potential GDP decreases to fill the resultant deflationary gap.
• B) a recessionary gap is created and the AS curve shifts rightward as the money wage rate falls.
• C) a recessionary gap is created shifting the AD curve rightward.
• D) an inflationary gap is created shifting the AS curve leftward as the money wage rate rises.
• E) an inflationary gap is created shifting the AD curve rightward.

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Definitions:

Self-Presentation Motivation

The drive individuals have to control and shape how others perceive them, often by adjusting their behavior or appearance.

Social Anxiety

A psychological condition characterized by intense fear or anxiety in social situations, leading to avoidance or significant distress.

Global Attribution

The tendency to generalize causes of an individual's behavior to their character or personality, disregarding situational factors.

Specific Attribution

The process of identifying a particular cause for an event or behavior, distinguishing it from more general or vague attributions.