Increased Consumer Spending Will Usually Cause

question 112

Multiple Choice

Increased consumer spending will usually cause:

• A)lower consumer prices.
• B)reduced employment levels.
• C)lower tax revenues.
• D)lower interest rates.
• E)higher employment levels.

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Definitions:

Structurally Unemployed

Individuals who are unemployed due to shifts in the economy that create a mismatch between their skills and the demands of the current job market.

Frictionally Unemployed

Individuals who are temporarily out of work while transitioning between jobs, typically due to voluntary decisions.

Cyclically Unemployed

Individuals who are out of work due to downturns in the business cycle, characterized by reduced demand for goods and services.

Rate of Inflation

The rate at which the general level of prices for goods and services is rising, and, subsequently, eroding purchasing power.