If Policymakers Decrease Aggregate Demand,then in the Long Run

question 43

Multiple Choice

If policymakers decrease aggregate demand,then in the long run

• A)prices will be lower and unemployment will be higher.
• B)prices will be lower and unemployment will be unchanged.
• C)prices and unemployment will be unchanged.
• D)None of the above is correct.

---

Definitions:

State Tax Rate

The percentage at which individuals or businesses within a state are taxed by the state government.

FICA

The Federal Insurance Contributions Act; a U.S. law that requires a deduction from paychecks to fund Social Security and Medicare benefits.

OASDI

The Old-Age, Survivors, and Disability Insurance program, part of the U.S. Social Security system, providing benefits to eligible retirees, their families, and the disabled.

Medicare

A federal health insurance program in the United States for people who are 65 or older, certain younger people with disabilities, and people with End-Stage Renal Disease.