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Economic management — Question 30

Original QCE Vault practice · 1 mark

Q30 · Practice questionComplex familiar1 mark

QUESTION 30

Following a temporary negative supply shock, tightening monetary policy creates a short-term trade-off because it can

(A)
reduce demand inflation pressure while further weakening output and employment.
(B)
repair damaged supply chains immediately.
(C)
raise output and lower all costs at the same time.
(D)
guarantee price stability without any employment effect.
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