Exhibit 14A-4 Macro AD-AS Model

question 55

Multiple Choice

Exhibit 14A-4 Macro AD-AS Model

-In Exhibit 14A-4,point P₂,Y₁ represents:

• A) that the economy needs policies to reduce unemployment.
• B) a long-run equilibrium.
• C) a short-run equilibrium.
• D) that the economy is at full employment.

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Definitions:

Collateral Contract

A secondary agreement made in addition to a primary contract, which induces a party to enter into the primary contract.

Leading Object Rule

A legal principle in contract law used to determine whether a promise is enforceable under the Statute of Frauds.

Parol Evidence Rule

A legal principle that prohibits the use of oral or extrinsic evidence to contradict, vary, or add to the terms of a written contract.

Collateral Promise

A secondary promise to pay another person's debt only if that person fails to pay.