If the Economy's Current Level of Output Is Below Its

question 62

Multiple Choice

If the economy's current level of output is below its potential level of output, the short-run aggregate supply curve:

• A)will shift right.
• B)will shift left.
• C)will be vertical.
• D)does not matter; only the long-run aggregate supply curve matters in this situation.

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Definitions:

Deductible Amount

The portion of a claim that a policyholder must pay out of pocket before the insurance covers the remaining costs.

Adverse Selection

A situation where asymmetric information leads to the selection of undesirable participants in a transaction or contract, often seen in insurance markets.

Consumer Surplus

The divergence between the total sum consumers are inclined and able to disburse for a merchandise or service, and the total sum they actually disburse.