Suppose Real GDP Exceeds Potential GDP

question 168

Multiple Choice

Suppose real GDP exceeds potential GDP. If the government decreases its expenditures on goods and services, then real GDP ________ and the price level ________.

• A) decreases; rises
• B) increases; falls
• C) decreases; falls
• D) increases; rises

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Definitions:

Cerebral Cortex

The outer layer of neural tissue of the cerebrum in the brain, playing a key role in memory, attention, perceptual awareness, thought, language, and consciousness.

Localization

The determination or mapping of specific functions or processes to particular areas of the brain or body, often used in neuroscience and biology.

Brain Function

The activities and processes that take place in the brain to support physical, cognitive, and emotional life.

Somatosensory Area

A region of the brain responsible for processing sensory information from various parts of the body, relating to touch, temperature, and pain.