Solved

If Policy Makers Choose to Use a Contractionary Fiscal Policy

Question 47

Multiple Choice

If policy makers choose to use a contractionary fiscal policy as a response to the recession caused by a negative supply shock, _____.


A) both aggregate output and inflation will increase
B) both aggregate output and unemployment level will increase
C) aggregate output will and unemployment will increase
D) aggregate output will increase and unemployment will decrease
E) both unemployment and prices will decrease

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions