A country is a net importer of oil. If the world price of oil rises, which of the following events occur?

Question

Answer

Long-run aggregate supply increases, but short-run aggregate supply does not change.

Answer

Short-run aggregate supply decreases, but long-run aggregate supply does not change.

Answer

Short-run aggregate supply decreases, but long-run aggregate supply increases.

Answer

Both short-run and long-run aggregate supply decrease.

Answer

Both short-run and long-run aggregate supply increase.

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