In New Classical Economics, a "Price-Level Surprise

question 119

Multiple Choice

In new classical economics, a "price-level surprise"

• A) has no effect on the economy.
• B) causes a temporary change in real output.
• C) causes a permanent change in real output.
• D) can never occur since people correctly anticipate the future.

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Definitions:

Society

A structured community of people bound together by similar traditions, institutions, or nationality.

Waste Of Resources

The inefficient or ineffective use of materials, energy, effort, money, or time in achieving a goal or outcome.

Zero-Inflation Policies

Economic policies aimed at achieving a very low and stable rate of inflation, often through tight control of the money supply and interest rates.

Proponents

Individuals or groups who support or advocate for a particular idea, proposal, or course of action.