If There Is an Inflationary Spiral,GDP Will Fall as Inventories

question 68

True/False

If there is an inflationary spiral,GDP will fall as inventories rise.
An inflationary spiral results from the opposite.The AD curve intersects the AS curve to the right of full employment,leading to a depletion of inventory levels.Costs and prices rise as firms attempt to restore inventory levels.

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Definitions:

Maslow's Theory

A psychological theory proposed by Abraham Maslow that suggests human needs are arranged in a hierarchy from physiological needs to safety, love and belonging, esteem, and self-actualization.

Self-actualization

The achievement of unlocking one’s abilities and possibilities, seen as an innate motivation or necessity found within all individuals.

Hierarchy of Needs

A theory proposed by Abraham Maslow suggesting that people are motivated by increasingly complex needs starting from basic physical necessities up to self-actualization.

Innate Need

A fundamental psychological or physiological requirement that is inherent and essential for the well-being and survival of an individual.