A price shock occurs when
A)the monetary policy rule changes.
B)the Fed acts to raise interest rates.
C)the spending balance changes.
D)key commodity prices change.
E)the AD curve shifts to the right.

Question

Quizplus · Accepted Answer

A price shock occurs when key commodity prices change. This can have an impact on inflation, as price increases in key commodities can cause a significant increase in overall price levels.

A Price Shock Occurs When