A Shock Increases the Costs of Production

question 13

Multiple Choice

A shock increases the costs of production.Given the effects of this shock,if the central bank wants to return the unemployment rate towards its previous level it would

• A)increase the rate at which the money supply increases.This will also move inflation closer to its previous rate..
• B)increase the rate at which the money supply increases.However,this will make inflation higher than its previous rate
• C)decrease the rate at which the money supply increases.This will also move inflation closer to its original rate
• D)decrease the rate at which the money supply increases.However,this will make higher than its previous rate.

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Definitions:

Criminal Case

A legal proceeding brought against an individual or entity accused of breaking the law, where guilt must be proven beyond a reasonable doubt.

Extortion

The process of securing something, especially financial gains, through the use of threats or compulsion.

Accepting Bribes

The unethical and often illegal act of receiving or soliciting something of value in exchange for influence or action in an official capacity.

Life Imprisonment

A prison sentence where the convict is required to remain in prison for the rest of their life or until parole is granted, if eligible.