What Would Cause Prices to Rise and Real GDP to Fall

question 29

Multiple Choice

What would cause prices to rise and real GDP to fall in the short run?

• A) an increase in the expected price level
• B) optimism about the future
• C) an increase in the quantity of labour available
• D) a decrease in interest rates

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Definitions:

Regents Of The University Of California V. Bakke

A landmark 1978 Supreme Court case that ruled against rigid racial quotas but allowed race to be considered as one of several factors in college admissions.

Affirmative Action

Policies and procedures designed to combat historical discrimination by providing preferential treatment to underrepresented groups in education, employment, and other areas.

Quotas

Preset limits or targets for the amount of goods or people allowed, often used in international trade or immigration policies.