An Economist Who Would Most Likely Use Active Policymaking Would

question 220

Multiple Choice

An economist who would most likely use active policymaking would support which of the following conclusions?

• A) Pure competition is not typical in most markets.
• B) Price flexibility is common in most markets.
• C) Demand shocks have little or no short-run effects on real Gross Domestic Product (GDP) and unemployment.
• D) Supply shocks explain most business cycles.

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Definitions:

Ledger

A comprehensive collection of accounts that records all financial transactions of a business, categorized for reporting and analysis purposes.

Adjusting Entries

Journal entries made at the end of an accounting period to allocate revenue and expenses to the period in which they actually occurred.

Closing Entries

Journal entries made at the end of an accounting period to transfer temporary account balances to permanent accounts and prepare the company’s books for the next period.

Financial Statements

Reports that summarize the financial performance, position, and cash flows of a business over a specific period of time, including the balance sheet, income statement, and statement of cash flows.