The adjustment back to a long-run equilibrium after a sudden decrease in aggregate demand:
A. happens very quickly, leading to a temporary decrease in the unemployment rate.
B. happens very quickly, leading to a temporary increase in the unemployment rate.
C. takes a long time, during which the economy is growing very rapidly and very few people are unemployed.
D. takes a long time, during which the economy is not growing much and many people are unemployed.
Ans: D. takes a long time, during which the economy is not growing much and many people are unemployed.
You might also like to view...
An example of contractionary fiscal policy is
A) increasing government spending. B) increasing taxes. C) decreasing government spending. D) decreasing taxes. E) b and c
Voters' Ordered PreferencesAbbyBobCarloPublic parksPublic zooPublic transportationPublic zooPublic transportationPublic parksPublic transportationPublic parksPublic zooIf a pair-wise majority vote was held and the voters' preferences are shown in the table, assuming public parks and the zoo was the first pair to be voted on, which option would win overall?
A. Public transportation B. Public parks C. Both Public parks and zoo. D. Public zoo