Which of the Following Is True

question 18

Multiple Choice

Which of the following is true?

• A)​Inflation and unemployment rates can both increase in the short run in response to negative supply shocks.
• B)​Inflation and unemployment rates cannot both decrease in the short run in response to reduced aggregate demand.
• C)​Inflation and unemployment rates can both decrease in the short run in response to positive supply shocks.
• D)​All of the above are true.

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Definitions:

Representativeness Heuristic

Judging the likelihood of things in terms of how well they seem to represent, or match, particular prototypes; may lead us to ignore other relevant information.

Algorithm

A fixed, step-by-step procedure or set of rules for solving a problem or accomplishing a task.

Concept

A mental grouping of similar objects, events, ideas, or people.

Transport Vehicles

Vehicles designed for the transportation of goods or passengers.