The Basic Keynesian Model Explains How a Decrease in Planned

question 110

Multiple Choice

The basic Keynesian model explains how a decrease in planned aggregate expenditure in the short run can cause a(n) ________ as producers cut production at preset prices to meet the lower demand and actual output ________ the potential output.

• A) expansionary gap;falls below
• B) recessionary gap;falls below
• C) recessionary gap;rises above
• D) expansionary gap;rises above
• E) recessionary gap;remains equal to

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Definitions:

Ambiguous Situations

Circumstances or scenarios that lack clarity or have multiple interpretations.

Rationalizations

The process of providing reasonable explanations for behaviors, decisions, or business practices that may otherwise appear irrational or unjustified, often to align with societal norms or ethical standards.

Unethical Behaviour

Actions or practices by individuals or organizations that violate moral principles or accepted standards of conduct.

Social Morality

Collective ideas about what is considered right and wrong behavior in society, shaped by cultural, religious, and personal beliefs.