In the Classical Model, High Unemployment Due to a Change

question 157

Multiple Choice

In the classical model, high unemployment due to a change in aggregate demand

• A) can persist for an indefinite period of time.
• B) will return to its normal level quickly as wages adjust.
• C) will persist if due to a supply shock but not if due to a demand shock.
• D) never exists because unemployment can never deviate from its normal level.

---

Definitions:

Free Association

A psychoanalytic process in which a patient says whatever comes to mind without censorship, used to explore the unconscious.

Insight

The capacity to gain an accurate and deep intuitive understanding of a person or thing, often resulting in the abrupt resolution of a problem.

Resistance

The act of opposing or fighting against something, which can be physical, psychological, or symbolic in nature.

Psychoanalytic Interpretation

An approach in psychology that seeks to understand the underlying psychological meanings and motivations behind behaviors and thoughts.