Suppose that there is a negative aggregate demand shock and the central bank commits to an inflation rate target. But if the commitment is not credible, then
A) the public's expected inflation will remain unchanged.
B) the short-run aggregate supply curve will rise.
C) economic contraction will be worse.
D) all of the above.
E) both B and C.
E
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In Figure 5-19, the consumer experiences at point C
A. greater total utility than at point D. B. greater total utility than at point E. C. less total utility than at point D. D. total utility equal to that experienced at point D.
The U.S. economy rarely grows
a. True b. False Indicate whether the statement is true or false
According to the law of supply, what will motivate firms to increase their quantity supplied of a product?
A. Fixed cost B. Price C. Supply D. Production cost
Which of the following statements is true?
A) In general, if a product has few substitutes it will have an elastic demand. B) The more time that passes the more inelastic the demand for a product becomes. C) The demand curve for a necessity is more elastic than the demand curve for a luxury. D) The more narrowly we define a market, the more elastic the demand for a product will be.