A Negative Shock in Aggregate Demand Will Likely Result in ________

question 18

Multiple Choice

A negative shock in aggregate demand will likely result in ________.

• A)a permanent change in output,if the central bank responds by lowering interest rates
• B)no permanent change in the equilibrium inflation rate,unless the central bank responds by lowering interest rates
• C)an eventual increase in aggregate supply for any inflation rate,if the central bank responds by lowering interest rates
• D)all of the above
• E)none of the above

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