Which of the Following Is True for a Temporary Adverse

question 77

Multiple Choice

Which of the following is true for a temporary adverse supply shock effects?

• A)lower output,higher interest rate and price level
• B)lower output,lower interest rate and price level
• C)higher output,lower interest rate and price level
• D)lower output,higher interest rate and lower price level

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Definitions:

Required Reserve Ratio

The fraction of deposits that banks are required to keep on hand as reserves, either in cash or as deposits with a central bank.

Checkable Deposits

Deposits in financial institutions that can be withdrawn by writing a check or using a debit card.

Reserves

Assets held by financial institutions or central banks as a requirement or for ensuring liquidity in times of need, including cash, deposits, or securities.

Money Supply

The Money Supply is the total amount of monetary assets available in an economy at any specific time, including cash, coins, and balances held in checking and savings accounts.