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Suppose the Economy Is Initially at Point a in the Diagram

Question 35

Multiple Choice

Suppose the economy is initially at point A in the diagram below, and there is a sudden increase in oil prices that the central bank believes is only temporary. Which point best depicts where the economy will end up in the short run? Suppose the economy is initially at point A in the diagram below, and there is a sudden increase in oil prices that the central bank believes is only temporary. Which point best depicts where the economy will end up in the short run? A) A B) B C) C D) D E) E


A) A
B) B
C) C
D) D
E) E

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