Suppose a Recession Occurs as a Result of a Supply

question 56

Multiple Choice

Suppose a recession occurs as a result of a supply shock,and instead of the economy naturally working its way back to equilibrium,the government uses policy to shift the aggregate demand curve to fight the recession.Using policy this way would

• A)bring real GDP back to potential GDP more quickly but would result in a permanently higher price level.
• B)bring real GDP back to potential GDP more slowly but would bring the price level back to the original price level more quickly.
• C)quickly result in a new,higher level of real GDP and a permanently lower price level.
• D)bring the price level back to its original level more quickly but would result in a permanently lower level of potential GDP.

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Definitions:

Solution-Focused Therapists

Therapists who adopt a goal-directed approach, focusing on solutions and preferred futures rather than dwelling on past problems.

Interactive Dialogue

A reciprocal communication process in which participants exchange information, feelings, and meaning through verbal and non-verbal messages.

Narrative Therapists

Practitioners of a therapeutic approach that seeks to help patients identify their values and the skills associated with them in order to live these values so they can effectively confront current and future problems.

Dominant Discourses

The prevalent narratives or ways of thinking in a given society that shape perceptions, behaviors, and policies.