A negative aggregate supply shock will a. Cause output to fall and inflation to fall b....

Question

Question

A negative aggregate supply shock will

a. Cause output to fall and inflation to fall

b. Cause output to fall and inflation to increase

c. Not affect output, but cause inflation to increase

d. Not affect output or inflation

business finance

Answer 1

Answer #1

a negative supply shock decreases output causing prices to rise,

Hence the answer is,

B) Cause output to fall and inflation to increase

Answer 2

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