An Increase in the Price Level Due to an Increase

question 106

Multiple Choice

An increase in the price level due to an increase in the price of oil

• A)creates stagflation in the short-run and will trigger a cost-push inflation.
• B)creates stagflation in the short-run and may trigger off a cost-push inflation.
• C)increases output above potential GDP.
• D)leads to an increase in the money wage rate.
• E)leads to a decrease in the money wage rate.

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