An Unexpected Increase in the Price Level That Temporarily Lowers

question 35

Multiple Choice

An unexpected increase in the price level that temporarily lowers real wages and induces more employment and output in an economy,occurs in

• A)nominal-supply theory.
• B)stagflation.
• C)misperceptions theory.
• D)sticky-wage theory.

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Definitions:

Richard Lazarus

A psychologist who was a pioneer in the study of emotion and stress, especially in the context of cognitive appraisal.

Theory of Emotion

A psychological framework that attempts to explain the complex relationships between cognitive processes, physiological responses, and the experience and expression of emotions.

Physical Arousal

The physiological response of the body to stimuli, which can manifest in increased heart rate, energy, and often sexual readiness.

Schachter and Singer

Psychologists who developed the Two-Factor Theory of Emotion, which emphasizes the role of physiological arousal and cognitive labels in emotion.