When They Are Confronted with an Adverse Shock to Aggregate

question 23

Multiple Choice

When they are confronted with an adverse shock to aggregate supply,policymakers face a difficult choice in that

• A)if they contract aggregate demand,the unemployment rate will increase further.
• B)if they expand aggregate demand,the inflation rate will increase further.
• C)they face a less favorable trade-off between inflation and unemployment than they did before the shock.
• D)All of the above are correct.

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Definitions:

Independence

The state of being self-sufficient and not reliant on external forces or entities for decision-making or governance.

Whole Employee

A concept emphasizing the consideration of employees' life outside work, promoting work-life balance and holistic well-being.

Work Environment

The physical and psychological conditions under which employees perform their job duties, including the office layout, culture, and policies.

Social Identities

Aspects of a person's self-concept derived from perceived membership in social groups such as national, cultural, religious, and gender.