Chapter 9: Classical Macroeconomics and the Self-Regulating Economy: Pre-Clsss and ln-Class Activities Packet NameilJl Number: Section: Date: Part 2. Hatching: Match the Key terms in Column "A\" with the denitions in Column \"B" by writing the block [upper] case letter of your choice under column "A\" and match the denitions in column "B" with the meanings or examples or real world applications in column "C\" by writing the small [lower] case letter of your choice uncler column \"B". Column \"A" _1. Say's Law Column \"B\" A. The condition in which the Real GDP a. that the economy is producing is greater than the Manual Real GDP and the unemployment rate is less than the natural unemployment rate. 2. Recoasionary Gap B. A public policy of not interfering with _3. Inflationary Gap 4. Laissez- faire market activities in the economy. _C. Supply creates its own demand. Production Creates enough demand to purchase all the goods and services produced. _D. The condition in which the Real GDP that the economy is producing is less than the Natural Fieal GDP and the Unemployment rate is greater than the Natural unemployment rate. Column \"C" The lGap created because the economy is under producing goods and services due to lack of aggregate demand in the overall economy and unemployment is high and ination is low during this period. The law advanced by Jean Babtiste Say, a Classical economist who believe in a laissez. faire or free enterprise system and who believe that what ever is produced will be consumed. The Gap created because the economy is over heated and producing over and above its usual full capacity or full employment level because workers have more than one job and they are compensating for the lost output from those who are unemployed but this may create mild rate of ination. d. A free market economic system that allows the price and the market system to direct and coordinate economic activities. .2