Economy experienced stagflation

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Reference no: EM131389252

In the 1970s, the economy experienced stagflation - a situation where prices rise but output falls. In the short run, then, stagflation must be caused by

the AS curve shifting rightward

the AD curve shifting leftward

the AD curve shifting rightward

the AS curve shifting leftward

In the long run, the shift described in the last question would cause ________ in the price level and _______ in real output.

no change; a decrease

a decrease; no change

a decrease; an increase

none of the listed options

an increase; a decrease

Reference no: EM131389252

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