The OPEC oil embargo of 1973 (an event marked by a reduction in the production o

Question

The OPEC oil embargo of 1973 (an event marked by a reduction in the production of oil, a reduction in oil exported to the United States, and an increase in oil prices in the United States) may have contributed to the (expansion/recession) of 1973 and the (increase/decrease) in real GDP caused by a(n) (increase/decrease)  in aggregate supply.

In 2000, the unemployment rate dropped under 4%, which is below what economists believe to be the natural rate. After the Great Recession, the unemployment rate remained stubbornly high. 12% 10% The Great Recession lasted from December 2007 to June 2009 896 6% 4% 2% 0% -2% The expansion from April 1991 to March 2001 lasted a full ten years, the longest expansion in U.S. history. -4% Real GDP plunged 8.2% in the fourth quarter of 2008. -6% -8% -10% 1995 2000 2005 2010 2015

Explanation / Answer

Answer is recession of 1973,

Decrease in real GDP

Decrease in aggregate supply.

The oil shock of 1970's was mainly responsible for the stagflation the world economy experienced , that caused the slowdown of GDP with rising oil prices.

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