Question 1
Refer to the information provided in Figure 27.4 below to answer the question(s) that follow.
Refer to Figure 27.4. Stagflation would cause
◦ a higher price level and lower output.
◦ a higher price level and higher output.
◦ a lower price level and lower output.
◦ a lower price level and higher output.
Question 2
Refer to the information provided in Figure 27.4 below to answer the question(s) that follow.
Refer to Figure 27.4. Stagflation would
not be caused by a
◦ decrease in
AS.
◦ higher price level with lower output.
◦ higher price level with higher unemployment.
◦ shift to the right of AD.