According to the Passive Policymaker's Position, Why Would an Expansionary

question 58

Multiple Choice

According to the passive policymaker's position, why would an expansionary gap be eliminated?  

• A) because the short-run aggregate supply shifts to the left 
• B) because the short-run aggregate supply shifts to the right 
• C) because rising prices shift the aggregate demand to the left 
• D) because wages fall relatively quickly

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Definitions:

Individual Firm Level

The perspective of analyzing or considering operations, strategies, or impacts at the scale of a single organization, excluding sectoral or macroeconomic factors.

Suppliers Concentrated

A market condition where a small number of suppliers provide a large portion of products or services.

Switching Costs

Expenses that a consumer or company incurs as a result of changing from one product, service, supplier, or system to another.

Supplier Power

The level of control and influence that suppliers have over the price and availability of their products or services in the market.