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Posted on Jul 06, 2024

If the Fed implements contractionary monetary policy, while at the same time there is a negative supply shock, the level of real output will A.

If the Fed implements contractionary monetary policy, while at the same time there is a negative supply shock, the level of real output will

A. Decrease, and the price level will definitely decrease.

B. Decrease, and the price level will definitely increase.

C. Either increase or decrease, but the price level will stay the same.

D. Decrease, but the price level is indeterminate.

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