After an Unexpected ________ in the Price of Oil,the Long-Run

question 268

Multiple Choice

After an unexpected ________ in the price of oil,the long-run adjustment decreases the price level and ________ the unemployment rate as they return to their original levels.

• A)increase; increases
• B)increase; decreases
• C)decrease; increases
• D)decrease; decreases

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Definitions:

Common Resource

A resource like air or water that is available to all but susceptible to overuse and depletion because it is not excludable.

Negative Externalities

These are unintended and adverse effects of a product or economic activity that impact third parties who are not directly involved in the activity.

National Parks

Areas of natural beauty, historical significance or ecological importance, protected by the government for public enjoyment and preservation.

Public Good

An item or service offered to every member of a community for free, supplied either by public authorities or by a private entity or group without seeking financial gain.