The economy experienced stagflation

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Reference no: EM131387158

1. In the 1970s, the economy experienced stagflation - a situation where prices rise but output falls. In the short run, then, stagflation must be caused by

A - the AS curve shifting rightward

B - the AD cruve shifting rightward

C - the AD curve shifting leftward

D - the AS curve shifting leftward

2. In the long run, the shift described in the last question would cause ________ in the price level and _______ in real output.

A - decrease, no change

B - no change, decrease

C - increase, decrease

D - decrease, increase

E - none of the listed options

Reference no: EM131387158

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