Business, 31.12.2019 04:31 sandy8438

The government would want the economy to contract when real gdp is
a. above potential gdp and the price level is falling
b. below potential gdp in the price level is falling
c. above potential gdp and the price level is rising

Answers: 2

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Answer from: notkeandre9

The government would want the economy to contract when real GDP is;

C. Above potential GDP and the price level is rising.

Explanation:

An economy can be described as either expanding or contracting with regards to the supply of money in that particular economy.

Further explanations are as follows;

1. Expanding economy

An expanding economy is an economy where the money supply is very high. This is usually characterized by an increase in the nominal output in an economy, this as a result caused the gross domestic product to increase too. This simply means that the working population are very productive or the consumer spending is very high.

An expanding economy causes the prices of goods to go up causing an inflation since the money supply in the economy is high, the banks also charge a high interest rate.

2. Contracting economy

A contracting economy is an economy where the money supply is very low. This is usually characterized by a decrease in the nominal output in an economy, this as a result caused the gross domestic product to decrease too. A reduction of the money supply in an economy decreases the consumer spending.

An contracting economy causes the prices of goods to go down causing a deflation since the money supply in the economy is low, the banks also charge a lower interest rate.

In our case, if the government want the economy to contract then it means that the economy is in expansion and thus real GDP is above the potential GDP and the price is rising

Answer from: Quest

Via: "if you are found to be supplying or dealing drugs, the punishment is likely to be tough. supplying drugs doesn’t just apply to dealers. if police suspect that you intend to share drugs with your friends, this is still considered to be supplying.

being suspected of supplying drugs means you are much more likely to be charged. the amount of drugs found on you, and whether you have a criminal record, will be taken into account when a punishment is being decided.

decisions to prosecute are taken by the public prosecution service. the maximum sentences for intent to supply drugs are:

- up to life in prison or an unlimited fine (or both) for a class a drug- up to 14 years in prison or an unlimited fine (or both) for a class b or class c drug."sorry if this was a school question, you didnt supply options so i assumed it was a personal question, which if it is, reconsider selling or having possesion of any drugs at all. i wish you the best!

Answer from: Quest

the amount of money you earn by working is your income.

the percentage of people actively looking for a job is called unemployment.

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The government would want the economy to contract when real gdp is
a. above potential gdp and...

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