Macroeconomic Effects Of Supply Shocks
Which of the following is most likely to cause an increase in the average price level along with a short-run decrease in real GDP?
A
An unfavorable supply shock that shifts the SRAS curve to the left
B
An unexpected decrease in aggregate demand
C
A favorable supply shock that shifts the LRAS curve to the right
D
A favorable supply shock that shifts the SRAS curve to the left