Suppose the Economy Is Initially Operating at Full Employment

question 21

Multiple Choice

Suppose the economy is initially operating at full employment. A fiscal policy action that results in an increase in the size of the budget deficit will cause which of the following in the long run?

• A) an increase in real GDP.
• B) have no effect on both the level and composition of real GDP.
• C) a reduction in the price level.
• D) change the composition of real GDP.

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Definitions:

Patient's Confidentiality

The ethical and legal duty of healthcare providers to protect personal health information of patients from unauthorized disclosure.

Absolute Duty

An unconditional obligation that must be performed regardless of the circumstances.

California Supreme Court

The highest state court in California, responsible for overseeing and ruling on legal and constitutional issues.

Negligent

Involves a failure to take reasonable care to avoid causing injury or loss to another person.