Why Do Negative Supply Shocks Present Such a Difficulty for the Federal

question 93

Multiple Choice

Why do negative supply shocks present such a difficulty for the Federal Reserve?

• A) the Fed can choose to fight the rising price level,but this will result in lower unemployment.
• B) the Fed can choose to fight the rising unemployment,but this will result in an even lower price level.
• C) the Fed can choose to fight the falling unemployment,but this will result in an even higher price level.
• D) the Fed can choose to fight the rising unemployment,but this will result in an even higher price level.
• E) the Fed can choose to fight the rising unemployment,but this will result in higher taxes.

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Definitions:

REM Sleep

A stage of sleep characterized by rapid eye movements, low muscle tone, and vivid dreams.

Sleep Onset

The transition from wakefulness into sleep.

Minutes

A written record of the proceedings of a meeting.

REM Sleep

A stage of sleep characterized by rapid eye movements, more dreaming and bodily movement, and faster pulse and breathing.