When a Price Shock Has Occurred,inflation Returns to Its Pre-Shock

question 59

Multiple Choice

When a price shock has occurred,inflation returns to its pre-shock rate ________.

• A)in the period following the price shock
• B)in the period when output has returned to its pre-shock rate
• C)once the output gap has returned to zero
• D)only in the long run
• E)none of the above

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Definitions:

Hard Power

Power that coerces others and that is backed up by economic and/or military force.

Coercive

Relating to or characterized by the use of force or threats to compel someone to do something.

Multiculturalism

The public policy for managing cultural diversity in a multi-ethnic society, officially stressing mutual respect and tolerance for cultural differences within a country's borders.

Cultural Pluralism

A condition or system in which various cultural groups coexist within a society, retaining their individual cultural identities.