If the Aggregate Demand Curve and the Aggregate Supply Curve

question 297

Multiple Choice

If the aggregate demand curve and the aggregate supply curve intersect at a level of real GDP less than potential GDP,there is

• A)a recessionary gap.
• B)an inflationary gap.
• C)a rising price level.
• D)a falling real GDP.
• E)an above full-employment equilibrium.

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Definitions:

Used Car Dealers

Businesses specialized in selling pre-owned vehicles to consumers.

Strict Liability

The doctrine under which people may be liable for injuries to others whether or not they have been negligent or committed an international tort. Also called absolute liability.

Unavoidably Dangerous

Products or activities that cannot be made completely safe, no matter the amount of caution used in their design or execution.

Punitive Damages

Damages in excess of actual losses suffered by the plaintiff awarded as a measure of punishment for the defendant’s wrongful acts. Also called exemplary damages.