In the New Classical Model,workers and Firms Try to Keep

question 17

Multiple Choice

In the new classical model,workers and firms try to keep their real wages and relative prices from falling when ________.

• A)income falls
• B)they expect inflation to rise
• C)they expect inflation to fall
• D)they expect aggregate demand to fall

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Definitions:

Ego

Within the framework of psychoanalytic theory, it's the component of one's personality that acts as an intermediary among the desires of the id, the superego, and the exigencies of reality.

Psychodynamic Perspective

A psychological approach focusing on unconscious processes and emotional factors that underpin human behavior.

Unconscious Processes

Mental activities not readily available to conscious awareness, often influencing behaviors, thoughts, and feelings without one's notice.

Psychosexual Stages

According to Freud, stages in the developmental process children pass through; in each stage, sex drives are focused on the stimulation of certain areas of the body, and particular psychological issues can arouse anxiety.