Which of the Following Is an Example of an Adverse

question 141

Multiple Choice

Which of the following is an example of an adverse supply shock?

• A) a nationwide drought lasting for many months
• B) an outbreak of war among several of the Middle Eastern oil-producing countries
• C) an influenza virus that affects 50 percent of the labor force over a two month period
• D) a,b,and c
• E) a and c

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Definitions:

Exchange Rate

The ratio at which one nation’s currency can be exchanged for another nation’s currency.

National Rate

A standard or average interest rate, unemployment rate, or other statistical measure that applies across an entire country.