Assume an economy is suffering from stagflation. Suppose the government and the central bank are only interested in combatting unemployment. A. Using counter-cyclical fiscal policy could involve Answer 1 Question 7 government spending and Answer 2 Question 7 taxes. B. The central bank would use Answer 3 Question 7 monetary policy which results in Answer 4 Question 7 in the money supply pushing Answer 5 Question 7 interest rates leading to Answer 6 Question 7 in investment. C. Both A and B would result in Answer 7 Question 7 in Answer 8 Question 7 which is shown as a Answer 9 Question 7 shift. D. The net result could be Answer 10 Question 7 in the unemployment rate and Answer 11 Question 7 in the relative price level