In the Coordination Failure Model,the 'Good' Equilibrium Is Characterized by a

question 2

Multiple Choice

In the coordination failure model,the 'good' equilibrium is characterized by a

• A) higher real interest rate and a higher price level than the 'bad' equilibrium.
• B) higher real interest rate and a lower price level than the 'bad' equilibrium.
• C) lower real interest rate and a higher price level than the 'bad' equilibrium.
• D) lower real interest rate and a lower price level than the 'bad' equilibrium.
• E) lower real interest rate and a lower aggregate output than the "bad" equilibrium.

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Definitions:

Substantial Risk

A significant chance or danger of damage, harm, or adverse effects.

Felony

As a general rule, all crimes punishable by death or by imprisonment in a state prison.

Misdemeanor

Any crime that is punishable neither by death nor by imprisonment in a state prison.

Serious Crime

An act, typically involving violence, regarded by society as being particularly harmful or dangerous, and punishable by severe penalties including imprisonment.