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Suppose That the Economy Is Operating at Potential Output and the Money

question 63

Multiple Choice

Suppose that the economy is operating at potential output and the money supply increases. Aggregate output will _____ potential output, nominal wages will _____, and the SRAS will shift _____.


Definitions:

Conscious Awareness

The state of being awake and aware of one's surroundings, thoughts, and feelings.

Misleading Information

Incorrect or twisted information which leads to false impressions or conclusions.

Motivated Forgetting

A psychological process in which individuals subconsciously or consciously block out memories or information that is painful, embarrassing, or otherwise unpleasant.

Anxiety-Arousing Memories

Psychological phenomena where past memories cause significant distress due to their disturbing nature.

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