Consider the Basic AD/AS Macro Model in Long-Run Equilibrium

question 44

Multiple Choice

Consider the basic AD/AS macro model in long-run equilibrium.An expansionary AD shock will ________ the price level and ________ output in the short run.In the long run,the price level will ________ and output will ________.

• A)decrease; decrease; decrease further; decrease further
• B)decrease; decrease; decrease further; be restored to potential output
• C)increase; increase; increase further; increase further
• D)increase; decrease; increase further; be restored to potential output
• E)increase; increase; increase further; be restored to potential output

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Definitions:

Industrial Revolutions

Periods of major industrialization that transformed economies, societies, and manufacturing processes, starting in the late 18th century.

Sociology

The study of society, social institutions, and social relationships, encompassing the systematic analysis of social behavior, culture, and structure.

Social Groups

Collections of individuals who interact with each other, share similar characteristics, and collectively have a sense of unity.

Social Situation

The combination of social factors and cultural contexts that influence individuals' interactions and behaviors in a specific setting.