Multiple Choice
Suppose the economy is in equilibrium when there is a change in environmental policy that forces farmers to begin organic farming without any pesticides.We would expect to observe
A) a decrease in aggregate supply and an increase in aggregate demand.
B) a decrease in both real output and the natural rate of unemployment.
C) a decrease in real output and an increase in the natural rate of unemployment.
D) a decrease in real output and an increase in the price level.
Correct Answer:
Verified
Correct Answer:
Verified
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