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Question 15

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Use the following to answer questions :
Exhibit: Supply Shock Use the following to answer questions : Exhibit: Supply Shock   -(Exhibit: Supply Shock)  Assume that the economy starts at point A and there is a drought that severely reduces agricultural output in the economy for just one year. In this situation, point ______ represents the short-run equilibrium immediately following the drought and point ______ represents the eventual long-run equilibrium. A)  B; C B)  B; A C)  E; D D)  D; A
-(Exhibit: Supply Shock) Assume that the economy starts at point A and there is a drought that severely reduces agricultural output in the economy for just one year. In this situation, point ______ represents the short-run equilibrium immediately following the drought and point ______ represents the eventual long-run equilibrium.


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

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