In the AD-AS Model,stagflation Does Not Persist,because the Working of the Self-Correcting

question 15

Multiple Choice

In the AD-AS model,stagflation does not persist,because the working of the self-correcting mechanism of the economy ___________ the level of output and ___________ the price level until the economy eventually returns to a long-run equilibrium state,where actual output ___________ potential output.

• A) decreases;increases;equals
• B) increases;decreases;exceeds
• C) decreases;decreases;falls short of
• D) increases;decreases;equals
• E) decreases;increases;exceeds

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Definitions:

False Pregnancy

A condition in which a person believes they are pregnant and may even exhibit pregnancy symptoms, but is not actually pregnant.

Circum-

A prefix meaning around or about, often used in medical and geographical terms.

Around

Located or positioned on every side, or in a circular direction or position surrounding an object.

Semi-

A prefix meaning half or partially, often used to indicate that something is incomplete or limited.