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Which of the following sentence does the best fit here?
Policy makers are said to accommodate an adverse supply shock if they ___________________________.



A. Respond to the adverse supply shock by increasing aggregate demand, which further raises prices
B. Respond to the adverse supply shock by decreasing aggregate demand, which lowers prices
C. Respond to the adverse supply shock by decreasing short-run aggregate supply
D. Fail to respond to the adverse supply shock and allow the economy to adjust on its own

This question is part of Macroeconomics [Ch. 2
Asked by Emy_, Last updated: Jun 02, 2020

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Emy_

Emy_

Answered Oct 25, 2017

Respond to the adverse supply shock by increasing aggregate demand, which further raises prices
 

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