In the Classical Model, an Increase in the Unemployment Rate

question 253

Multiple Choice

In the classical model, an increase in the unemployment rate

• A) will persist when the reduction in output is caused by a reduction in aggregate demand.
• B) will result in an increase in the price level if the reduction in output is caused by a change in aggregate demand.
• C) will likely be temporary.
• D) is a signal of demand-pull inflation.

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Definitions:

Disorganized-disoriented

A term referring to behavior patterns that exhibit confusion or lack of structure, often linked with attachment issues in psychology.

Erik Erikson

A developmental psychologist and psychoanalyst known for his theory on the psychological development of human beings across eight stages from infancy to adulthood.

Autonomy Versus Shame

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Industry Versus Inferiority

A stage in Erik Erikson's theory of psychosocial development where children develop a sense of competence and ability when they successfully manage new skills and tasks.