If the Bank of Canada accommodates an adverse supply shock, output falls _____, and prices rise _____.

Name: If the Bank of Canada accommodates an adverse supply shock, output falls _____, and prices rise _____.
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When the Bank of Canada accommodates an adverse supply shock, it typically eases monetary policy to support output, causing output to fall less than it would without intervention, but this can lead to higher inflation, causing prices to rise more.

If the Bank of Canada Accommodates an Adverse Supply Shock