When We Compare PAE and Actual Output (Y) If PAE

question 45

Multiple Choice

When we compare PAE and actual output (Y) if PAE is greater than Y we expect that:

• A) eventually production will decrease.
• B) eventually production will increase.
• C) there will be no change in aggregate production.
• D) the government will intervene by cutting down on taxes.

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Definitions:

Risk of Loss

The potential for an asset to decrease in value or for an event to cause financial hardship.

Jewelry Store

A retail business establishment specialized in selling jewelry, including rings, necklaces, earrings, and bracelets.

Insurable Interest

A requirement in insurance policies that the policyholder must stand to suffer a financial loss from the insured event, giving them a legitimate interest in seeking coverage.

Buyers

Individuals or entities that purchase goods or services.