Shocks to the economy occur
A) when expectations are unmet.
B) whenever the price level changes.
C) whenever government implements ﬁscal or monetary policy.
D) because most economic behavior is unpredictable.

Question

Quizplus · Accepted Answer

Shocks to the economy occur when expectations are unmet, such as unexpected changes in productivity, natural disasters, or geopolitical events. While changes in the price level or government policy can have impacts on the economy, they are not necessarily considered shocks in and of themselves. Economic behavior may be unpredictable, but that is not the primary driver of shocks to the economy.

Shocks to the Economy Occur