Any Positive Price Shock Affecting an Economy Initially Operating at Full

question 4

Multiple Choice

Any positive price shock affecting an economy initially operating at full potential

• A) can be expected to cause some increase in inflation unless the economy is willing to accept some unemployment above the natural rate.
• B) can be expected to cause some immediate increase in unemployment above the natural rate regardless of the policy response.
• C) need not cause any increase in inflation, but only if the economy commits itself to a credible policy of maintaining output at potential GDP.
• D) need not cause any increase in unemployment above the natural rate, but only if the economy commits itself to a credible policy of increased aggregate demand.
• E) none of the above.

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Definitions:

Fetal Cells

Cells that make up the fetus during pregnancy, highly capable of differentiation and growth, playing a critical role in the development of the embryo into a newborn.

Genetic Disorders

Diseases or conditions caused by abnormalities in an individual’s DNA, which can be inherited or arise through mutations.

Noninvasive Prenatal Diagnosis

A method of determining fetal health and genetic conditions using maternal blood tests, avoiding direct sampling from the uterus.

Fetal Blood Cells

The cells within the blood circulation of a fetus, which are crucial for transporting oxygen and nutrients.