Which of the following is considered a negative supply shock? a) b) 28. an unexp

Question

Which of the following is considered a negative supply shock? a) b) 28. an unexpected increase in the price of natural gas an improvement in technology increasing investment in the economy causes the capital stock to rise d) decline in wages 29. When a person makes price comparisons among products, money is being used as a(n) a checkable deposit. b standard of quality. c medium of exchange. d) unit of account. e store of value. Assume the required reserve ratio is 5 percent, and banks loan 100 percent of excess reserves. The resulting money multiplier is a) 20 b) .05 d) 10

Explanation / Answer

28) Option a is correct

An unexpected increase in the price of natural gas - negative supply shock (production costs increase)

29) Option d is correct

Money is being used as a unit of account

30) Money multiplier = 1/r = 1/5% = 20

Option a is correct

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