The Economy Is in Long-Run Equilibrium

question 83

Multiple Choice

The economy is in long-run equilibrium:

• A) when the AD and AS curves intersect at potential output Y*.
• B) when the AD and AS curves intersect, regardless of the level of output.
• C) when the AD and AS curves become vertical.
• D) only when the business cycle is eliminated.

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Definitions:

Political Parties

Organized groups of people with similar political aims and opinions, seeking to influence public policy by getting their candidates elected to public office.

Party Systems

The system of political parties operating within a country, defined by their number, organization, and competition dynamics.

Major Political Parties

The dominant political parties in a political system that have the greatest influence over policy and politics, typically holding the majority of positions in government.

Democracy

A form of government in which power is vested in the hands of the people, who may exercise it directly or through representatives elected by them.