QUESTION 1 Match the definitions to the correct word. The study of how humans make choices under conditions of A. Consumer Price Index scarcity. B. Keynesian Perspective Products (goods and services) made abroad and then sold domestically. C. Potential GDP Products (goods and services) made domestically and sold D. Fiscal Policy abroad. E. Imports The measure of the size of total production in an economy. F. Economics Policy that involves altering the level of interest rates, the G. Neoclassical Perspective availability of credit in the economy, and the extent of borrowing. H. Monetary Policy *Policy that involves changes in government spending/purchases ,. Exports and taxes * A measure of inflation that U.S. government statisticians J. Gross Domestic Product calculate based on the price level from a fixed basket of goods and services that represents the average consumer's purchases. * The economic perspective which focuses on aggregate demand. The idea is simple: firms produce output only if they expect it to sell. The economic perspective which believes short-term fluctuations in economic activity would rather quickly, with flexible prices, adjust back to full employment. This view of the economy implied a vertical aggregate supply curve at full employment GDP, and prescribed a "hands off" policy approach. The maximum quantity that an economy can produce given full employment of its existing levels of labor, physical capital, technology, and institutions