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
Correct Answer:
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Q1: A credit crunch will
A) Raise borrowing costs
Q2: A main reason why the Fed introduced
Q3: A positive aggregate demand shock affecting an
Q5: A persistent positive aggregate supply shock, say
Q6: The economy can move and stay off
Q7: When news about the economy points to
Q8: Central bank credibility
A) Is irrelevant to the
Q9: Having a single monetary policy goal of
Q10: If output were at potential and inflation
Q11: Advocates of a money stock rule have
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