Policymakers who control monetary and fiscal policy and want to offset the effects on output of an economic contraction caused by a shift in aggregate supply could use policy to shift
A)aggregate supply to the right.
B)aggregate supply to the left.
C)aggregate demand to the right.
D)aggregate demand to the left.

Question

Quizplus · Accepted Answer

To offset an economic contraction caused by a shift in aggregate supply, policymakers can use expansionary fiscal or monetary policy to increase aggregate demand, shifting it to the right, to boost output and counteract the contraction.

Policymakers Who Control Monetary and Fiscal Policy and Want to Offset