According to Classical Economists, When Aggregate Demand Decreases

question 250

Multiple Choice

According to classical economists, when aggregate demand decreases

• A) unemployment is reduced, the price level increases, and equilibrium real GDP is reached.
• B) unemployment is reduced, the price level decreases, and equilibrium real GDP is reached.
• C) unemployment temporarily increases, the price level increases, and equilibrium real GDP is reached.
• D) unemployment temporarily increases, the price level decreases, and equilibrium real GDP is reached.

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Definitions:

Physiological Dependence

A condition arising from chronic use of a substance where the body becomes reliant on it for normal functioning, leading to physical withdrawal symptoms when the substance is not taken.

Nicotine

A potent stimulant and the addictive component found in tobacco products, affecting the nervous system.

Nembutal

A barbiturate drug used primarily as a sedative or for short-term treatment of insomnia.

Selective Attention

The focus of one’s consciousness on a particular stimulus.