Exhibit 10-12 -Consider Exhibit 10-12.Aggregate Demand Is Represented by AD₀ and the AD₀

question 176

Multiple Choice

Exhibit 10-12
-Consider Exhibit 10-12.Aggregate demand is represented by AD₀ and the aggregate supply is AS₁₀₀ since the expected price level is 100.Which of the following describes the current situation for this economy?

• A)an expansionary gap exists
• B)a recessionary gap exists
• C)a long-run equilibrium exists
• D)an employment gap exists
• E)an economic growth gap exists

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Definitions:

Respondent Behavior

Respondent behavior refers to automatic, reflexive responses to stimuli, as described in classical conditioning theories in psychology.

Operant Behavior

Behavior that is controlled by consequences, such as rewards or punishments.

Variable-Interval Schedule

A reinforcement schedule in operant conditioning where a behavior is rewarded after an unpredictable amount of time has passed.

Behavioral Responses

Actions or reactions of an organism as a result of external or internal stimuli.