Suppose Policymakers Take Actions That Cause a Contraction of Aggregate

question 3

Multiple Choice

Suppose policymakers take actions that cause a contraction of aggregate demand.Which of the following is a short-run consequence of this contraction?

• A)The inflation rate decreases.
• B)The level of output decreases.
• C)The unemployment rate increases.
• D)All of the above are correct.

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