Policy makers are said to accommodate an adverse supply shock if they ?

A. fail to respond to the adverse supply shock and allow the economy to adjust on its own.

B. respond to the adverse supply shock by decreasing aggregate demand which lower prices

C. respond to the adverse supply shock by increasing aggregate demand, which further raises prices

D. respond to the adverse supply shock by decreasing short run aggregate supply

Found an error? Read our corrections policy and submit a sourced correction below. You can also share a useful explanation in your own words.

Discuss the answer or suggest a sourced correction
Thank you for contributing.
Your comment was submitted and will appear after editorial review.

Your email is used only for moderation and is never displayed. Spam, copied material and fabricated endorsements are rejected.