Question: a. According to Figure 32.10, about how long does it take for an oil price shock to have its biggest impact on the economy? How

a. According to Figure 32.10, about how long does it take for an oil price shock to have its biggest impact on the economy? How long does it take before the oil shock’s effects completely go away?
b. What might be happening in the labor market that might explain why it takes so long for an oil shock to do its worst? (Glance through the transmission mechanisms listed in the chapter for some ideas.)

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