If an Economy Is Initially at a State of Long-Run

question 51

Multiple Choice

If an economy is initially at a state of long-run equilibrium, the short-run effect(s) from a decrease in aggregate demand will include:

• A)an expansionary gap.
• B)a higher rate of inflation.
• C)a higher level of potential output.
• D)a recessionary gap.

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Definitions:

Epithelial Tissue

A type of bodily tissue that lines the outer surfaces of organs and blood vessels, as well as the interior of hollow structures.

Endoscopy

A medical procedure that allows a doctor to inspect and observe the inside of the body without making large incisions, using an instrument called an endoscope.

Nervous

Pertaining to the nervous system, which includes the brain, spinal cord, and peripheral nerves, or feeling anxious and apprehensive.

Steroid

A type of organic molecule with a characteristic molecular structure containing four rings, used in medicine to reduce inflammation and as hormones in the body.