In the Long-Run Equilibrium

question 12

Multiple Choice

In the long-run equilibrium

• A)output is a function of autonomous expenditures.
• B)inflation is a function of past inflation.
• C)inflation equals potential output.
• D)output equals potential output.

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Definitions:

Decision Trees

A graphical representation used for making decisions, showing various outcomes based on different sequences of decision paths.

Expected Value

The projected value of a variable, computed as the average of all possible outcomes weighted by their probabilities.

Dollar Contribution

The amount of money that sales contribute to the firm's profit before fixed costs are subtracted.

Decision Trees

A graphical model used in decision making, representing different choices and their possible outcomes, including risks, costs, and benefits.