Which of the Following Is a Basic Component of Equity

question 18

Multiple Choice

Which of the following is a basic component of equity theory? 

• A) ​Valences 
• B) ​Referents 
• C) ​Instrumentalities 
• D) ​Expectancies

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Definitions:

Classical Dichotomy

The theoretical separation of nominal and real variables in the economy, suggesting that changes in the money supply only affect nominal variables and not real variables like output.

Monetary Neutrality

The economic theory suggesting that changes in the money supply only affect nominal variables and have no long-term effect on real variables such as output or employment.

Long-Run Aggregate-Supply Curve

The long-run aggregate-supply curve represents the total production of goods and services in an economy at different price levels, assuming all resources are fully utilized.

Misperceptions Theory

A theory suggesting that individuals' misperceptions about economic conditions can lead to fluctuations in economic output and employment.