Because People May Change How They React When Economic Policies

question 35

Multiple Choice

Because people may change how they react when economic policies are changed, comparing macroeconomic models is

• A) difficult.
• B) impossible.
• C) not attempted by legitimate economists.
• D) only effective for long-run analysis.

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Definitions:

Output

The quantity of goods or services produced in a given time period by a firm, industry, or country.

Production Function

A mathematical model that describes the relationship between input resources and the output of goods or services produced.

Inputs

Resources used in the production process to generate outputs, including labor, capital, and materials.

Output

The total amount of something produced by a person, machine, or industry.