An Aggregate Supply Shocks Can Be Either Temporary or Permanent

question 28

True/False

An aggregate supply shocks can be either temporary or permanent. Both types can cause deviations from the trend output.

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Definitions:

Statistical Significance

Indicates that the observed results are unlikely to have occurred by chance, according to a predefined level of significance.

Type I Error

The statistical mistake of rejecting a true null hypothesis, also known as a "false positive."

Type II Error

The error that occurs when one fails to reject a false null hypothesis, also known as a false negative.

Power

The probability that a statistical test will correctly reject a false null hypothesis, or the test's sensitivity to detecting an effect.