Business, 13.12.2019 23:31 jamesgotqui6
Consider the given statements regarding supply shocks and stabilization policies in response to supply shocks. label each statement as being either true or false.
when an economy experiences a negative supply shock, there is a simultaneous increase in inflation and unemployment.
a. true
b. false
both fiscal and monetary policy are aimed at shifting the aggregate demand curve. neither policy directly shifts the short‑run aggregate supply curve.
a. true
b. false
following a negative supply shock, expansionary monetary policy is used to reduce inflation.
a. true
b. false
only monetary policy can reduce both high inflation and high unemployment at the same time.
a. true
b. false
Answers: 3
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