When the Economy Is at Its Potential Output Level,which of the Following

question 76

Multiple Choice

When the economy is at its potential output level,which of the following is not true?

• A)Firms' and workers' expectations about the price level are realized.
• B)The nominal wage is a good measure of the expected real wage.
• C)The unemployment rate is about 4 to 6 percent.
• D)The economy is producing the maximum output it can produce in short periods of time; however,such a fast pace could not be maintained for long.
• E)The actual price level equals the expected price level.

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Definitions:

Hostility Between Groups

Negative attitudes and aggressive actions directed from one group towards another, often stemming from prejudices or conflict over resources or values.

Arbitration

A method of dispute resolution in which an impartial third party, the arbitrator, makes a decision to resolve a dispute.

Intergroup Contact

A theory positing that under certain conditions, direct contact between members of different social groups can reduce prejudice and intergroup tension.

Conciliation

A conflict resolution strategy that involves bringing disputing parties together to find a mutually acceptable solution to their issues.