In Long-Run Full-Employment Equilibrium, Which of the Following Is True

question 71

Multiple Choice

In long-run full-employment equilibrium, which of the following is true ?

• A) The CPI equals AD equals the peak of the production function curve.
• B) The horizontal LRAS curve equals the intersection of the demand and supply curves in the labor market.
• C) The CPI equals the aggregate production function at the equilibrium wage rates.
• D) The CPI equals AD equals SRAS equals LRAS.

---

Definitions:

Defective

Pertaining to a product or good that fails to meet quality standards or is unfit for its intended use due to flaws or errors.

Defendant's Control

The extent to which a defendant has the ability or power to manage, direct, or influence events or outcomes in a legal case.

Market Share Theory

Product liability theory which holds that when it is impossible to identify the manufacturer of a particular product that caused harm, the plaintiff may sue all manufacturers of the product, with liability apportioned among them on the basis of each one’s market share.

Products Liability Action

A legal claim against a manufacturer or seller for producing or selling a defective product causing injury or damage.