(Consider This) The U.S.recession that occurred in 2008 and 2009 represented a case where
A)government policy intervention effectively offset the negative demand shock and minimized the effects on output and employment.
B)prices were somewhat flexible, so the impact of the demand shock was felt about the same in terms of price and output changes.
C)prices were relatively flexible, minimizing the impact on total output and employment.
D)prices were relatively sticky and most of the impact was on total output.

Question

Quizplus · Accepted Answer

During the 2008-2009 recession, prices were relatively sticky, which meant that the negative demand shock primarily affected total output and employment rather than prices.

(Consider This) the U