What do the data for the period of 1968 through 1973 demonstrate?
A) that there is a short-run tradeoff between inflation and unemployment
B) that a supply shock can disrupt the short-run tradeoff between inflation and unemployment
C) that there is a long-run tradeoff between inflation and unemployment
D) that a demand shock can disrupt the short-run tradeoff between inflation and unemployment

Question

Quizplus · Accepted Answer

The data for the period of 1968 through 1973 demonstrate that a supply shock can disrupt the short-run tradeoff between inflation and unemployment, as evidenced by the phenomenon of stagflation during this period, which saw a combination of high inflation and high unemployment despite the conventional wisdom that the two variables were inversely related in the short run.

What Do the Data for the Period of 1968 Through