An inflation shock is:
A)the level of inflation consistent with output in a recessionary gap.
B)the level of inflation consistent with output in an expansionary gap.
C)a sudden change in the normal behavior of inflation, unrelated to the nation's output gap.
D)a change in the inflation rate generated by excessive aggregate spending.

Question

Quizplus · Accepted Answer

A sudden change in the normal behavior of inflation, unrelated to the nation's output gap is called an "inflation shock."

An Inflation Shock Is