Adverse Aggregate Supply Shocks Would Result in

question 41

Multiple Choice

Adverse aggregate supply shocks would result in

• A)a lower rate of inflation and a higher rate of unemployment.
• B)a higher rate of inflation and a lower rate of unemployment.
• C)a lower rate of inflation and a lower rate of unemployment.
• D)a higher rate of inflation and a higher rate of unemployment.

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Definitions:

Market Wage Rate

The average or standard amount of compensation paid to workers in a specific market or industry for their labor.

Minimum Wage Law

Legislation that sets the lowest hourly wage rate that employers can legally pay their workers.

Employment

The condition of having paid work or the process of hiring someone for a job.

Workers

Individuals engaged in any form of employment, contributing labor for the production of goods and services.