Suppose Government Does NOT Intervene in the Economy

question 82

Multiple Choice

Suppose government does NOT intervene in the economy.How would an expansionary gap be closed in the long run?  

• A) by a rightward shift of the short-run aggregate supply curve 
• B) by a leftward shift of the short-run aggregate supply curve 
• C) by a movement to the right along a fixed short-run aggregate supply curve 
• D) by a movement to the left along a fixed short-run aggregate supply curve

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Definitions:

Trading Costs

Expenses associated with buying and selling securities, including commissions and slippage.

Beta

A measure of a stock's volatility in relation to the market; a beta greater than one suggests greater volatility than the market, while a beta less than one indicates less.

Annualized Return

The geometric average amount of money earned by an investment each year over a given time period, expressed as a percentage.

International Joint Venture

A business arrangement in which two or more parties from different countries form a partnership to share resources, risks, and rewards in pursuing a specific business venture.