Imagine Two Economies That Are Identical Except That for a Long

question 170

Multiple Choice

Imagine two economies that are identical except that for a long time, economy A has had a money supply of $1,000 billion while economy B has had a money supply of $500 billion. It follows that

• A)real GDP and the price level are lower in country B.
• B)real GDP, but not the price level, is lower in country B.
• C)the price level, but not real GDP is lower in country B.
• D)neither the price level or real GDP is lower in country B.

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Definitions:

Concrete Operational

A stage in Piaget's theory of cognitive development, occurring roughly between the ages of 7 and 12, during which children gain the ability to think logically about concrete events.

Sensorimotor

Referring to a developmental stage in children characterized by the coordination of sensory experiences with motor actions.

Behavioral Perspective

An approach in psychology focusing on observable behaviors and the ways in which they are learned through interactions with the environment.

Human Impulses

Innate inclinations or promptings that drive individuals to think or act in certain ways without conscious deliberation.