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As a Result of a Positive Shock To C\vec { C }

Question 288

Multiple Choice

As a result of a positive shock to C\vec { C } :


A) inflation and output growth increase in the short run, but in the long run they return to the rates before the shock.
B) inflation and output growth decrease in the short run, but in the long run they return to the rates before the shock.
C) inflation increases and output growth decreases in the short run, but in the long run they return to the rates before the shock.
D) inflation and output growth increase in both the short run and the long run.

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