Isolated Negative Aggregate Supply Shocks,in the Absence of Monetary Validation,will

question 86

Multiple Choice

Isolated negative aggregate supply shocks,in the absence of monetary validation,will

• A)eventually be self-correcting as wages slowly fall.
• B)never be self-correcting without government policy to expand the money supply.
• C)be self-correcting only if the aggregate demand curve shifts.
• D)result in a permanent output gap.
• E)have no short-run or long-run effects.

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