When the Economy Is Experiencing a Negative Output Gap

question 38

Multiple Choice

When the economy is experiencing a negative output gap:

• A) some people and some capital are unemployed.
• B) the economy may be in a recession.
• C) there is little inflationary pressure due to low demand.
• D) All of these statements are true.

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Definitions:

Hypothalamus

A small forebrain structure, located just below the thalamus, that monitors three pleasurable activities—eating, drinking, and sexual behavior—as well as emotion, stress, and reward.

Parietal Lobes

Structures at the top and toward the rear of the head that are involved in registering spatial location, attention, and motor control.

Frustration-Aggression Hypothesis

A psychological theory suggesting that frustration often leads to aggressive behavior.

Aggression

Social behavior whose objective is to harm someone, either physically or verbally.