# an increase in the money supply b. a decrease in the money supply c. an adverse supply shock d. a favorable supply shock ANSWER: an adverse supply…

A. an increase in the money supply b. a decrease in the money supply c. an adverse supply shock d. a favorable supply shock ANSWER: c. an adverse supply shock TYPE: M DIFFICULTY: 1 SECTION: 17.3 122. Suppose that there is an adverse supply shock. TYPE: M DIFFICULTY: 1 SECTION: 17.3 121. Which of the following would cause the price level to rise and output to fall in the short run? A. an increase in the money supply b. a decrease in the money supply c. an adverse supply shock d. a favorable supply shock ANSWER: c. an adverse supply shock TYPE: M DIFFICULTY: 1 SECTION: 17.3 122. Suppose that there is an adverse supply shock. Which of the following curves shift left? A. both the aggregate supply curve and the Phillips curve. B. only the aggregate supply curve. C. only the Phillips curve. D. neither the aggregate supply curve nor the Phillips curve ANSWER: b. only the aggregate supply curve. TYPE: M DIFFICULTY: 2 SECTION: 17.2 123. Which of the following is correct if there is an a

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