Suppose the Economy Is Initially in Equilibrium and Then an Energy

question 150

Multiple Choice

Suppose the economy is initially in equilibrium and then an energy shock occurs,such as when OPEC raised oil prices.Which of the following is likely to result?

• A)Both the price level and aggregate output will rise.
• B)Both aggregate output and the price level will fall.
• C)Employment will rise.
• D)Stagflation.
• E)The price level will fall.

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Definitions:

Output Control

A management technique focused on measuring and regulating the output of employees or production processes to meet organizational goals.

Network Structure

The arrangement and interconnection of nodes or elements in a system that define how they communicate or relate.

Centralized Decision-Making

A decision-making process where major decisions are made by a small group of people or an individual at the top of an organizational hierarchy.

Division Of Labor

The assignment of different parts of a manufacturing process or task to different people in order to improve efficiency.