When Output Exceeds Its Full-Employment Level

question 38

Multiple Choice

When output exceeds its full-employment level,

• A)the short-run aggregate supply function shifts up.
• B)wages fall.
• C)the short-run aggregate supply function shifts down.
• D)aggregate supply exceeds aggregate demand.

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Definitions:

Parasympathetic Nervous System

A division of the autonomic nervous system responsible for conserving energy and promoting relaxation and recovery after periods of stress.

Digestion

The biological process by which the body breaks down food into absorbable nutrients.

James-Lange Theory

A theory of emotion proposing that emotions occur as a result of physiological reactions to events.

Autonomic Changes

Physiological adjustments made by the autonomic nervous system, controlling involuntary body functions in response to physical or psychological stress.