Question
An increase in the price level and a reduction in output would result from
a.
a fall in stock prices.
b.
bad weather in farm states.
c.
an increase in government expenditures.
d.
an increase in the money supply.
a.
a fall in stock prices.
b.
bad weather in farm states.
c.
an increase in government expenditures.
d.
an increase in the money supply.
Answers
GPT-4o mini
An increase in the price level and a reduction in output typically reflects a scenario characterized by supply-side constraints or negative supply shocks. Among the options provided, **b. bad weather in farm states** would most likely lead to a reduction in agricultural output, which can push prices up due to decreased supply of food and related goods. Therefore, the correct answer is:
**b. bad weather in farm states.**
**b. bad weather in farm states.**