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According to aggregate demand and supply analysis, the negative supply shocks of 1973-
1975 and 1978-1980 had the effect of ____.
A) increasing aggregate output, lowering unemployment, and raising the price level
B) decreasing aggregate output, raising unemployment, and raising the price level
C) increasing aggregate output, raising unemployment, and raising the price level
D) decreasing aggregate output, raising unemployment, and lowering the price level
Answer: B
Diff: 2 Type: MC Page Ref: 589 - 590
Skill: Applied
Objective List: 24.3 Differentiate between short-run and long-run equilibria in the context of the
aggregate demand and supply framework
According to aggregate demand and supply analysis, the favorable supply shock of 1995-
1999 had the effect of ____.
A) increasing aggregate output, lowering unemployment, and raising inflation
B) decreasing aggregate output, raising unemployment, and raising inflation
C) increasing aggregate output, lowering unemployment, and lowering inflation
D) decreasing aggregate output, raising unemployment, and lowering inflation
Answer: C
Diff: 2 Type: MC Page Ref: 589 - 590
Skill: Applied
Objective List: 24.3 Differentiate between short-run and long-run equilibria in the context of the
aggregate demand and supply framework
According to aggregate demand and supply analysis, the negative demand shock of 2000-
2004 had the effect of ____.
A) increasing aggregate output, lowering unemployment, and raising inflation
B) decreasing aggregate output, raising unemployment, and raising inflation
C) increasing aggregate output, lowering unemployment, and lowering inflation
D) decreasing aggregate output, raising unemployment, and lowering inflation
Answer: D
Diff: 2 Type: MC Page Ref: 589 - 590
Skill: Recall
Objective List: 24.3 Differentiate between short-run and long-run equilibria in the context of the
aggregate demand and supply framework