Assume Equilibrium Real GDP Per Year Is Equal to Full-Employment

question 77

Multiple Choice

Assume equilibrium real GDP per year is equal to full-employment real GDP. Which of the following will cause a recessionary gap?

• A) an increase in aggregate demand
• B) a reduction in aggregate demand
• C) a discovery of a new raw material
• D) a temporary reduction in the price of oil

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Definitions:

Personal Property

Personal property refers to assets or belongings that are movable and not permanently fixed to one location, such as furniture, vehicles, and electronics.

Debt

An obligation owed by one party (the debtor) to a second party (the creditor); often referring to borrowed money that must be repaid.

Chapter 11

A part of the United States Bankruptcy Code that permits reorganization under the bankruptcy laws of the United States for corporations and partnerships.

Reorganization

The process of restructuring a company's business affairs, debts, and assets, often in the context of bankruptcy proceedings, to allow continued operation and recovery from financial distress.