A Supply Shock Is Defined as

question 77

Multiple Choice

A supply shock is defined as

• A) a decrease in full-employment output.
• B) a surprise event that changes the firm's production costs.
• C) a reduction in aggregate demand that has a negative impact on the firm's revenue.
• D) a sudden upward movement along the short-run aggregate supply curve.
• E) an attempt by employees to negotiate a wage increase.

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Definitions:

Corporate Bonds

Debt securities issued by corporations to raise capital, with terms specifying the interest rate, maturity date, and other conditions.

Taxation

The process by which governments finance their expenditure by imposing charges on citizens and corporate entities.

Treasury Bond

A long-term, interest-bearing security issued by the U.S. Treasury with a maturity period typically longer than ten years.

Ask

The lowest price a seller is willing to accept for a security.