MACROECONOMICS

QUESTION 9 Assume that a supply shock results from an oil price increase, and that the short-run effect has already taken place. In the medium run, 0 inflation increases relative to its value at the end of the short run. 0 the interest rate increases relative to its value at the end of the short run. 0 the interest rate decreases relative to its value at the end of the short run. 0 output decreases relative to its value at the end of the short run. QUESTION 10 Assume that a supply shock results from an oil price increase. In the long run, 0 inflation is higher than its baseline value. 0 the interest rate is the same as its baseline value. 0 the interest rate is lower than its baseline value. 0 output is lower than its baseline value