A negative shock in aggregate demand will likely result in ________

A) a permanent change in output, if the central bank responds by lowering interest rates
B) no permanent change in the equilibrium inflation rate, unless the central bank responds by lowering interest rates
C) an eventual increase in aggregate supply for any inflation rate, if the central bank responds by lowering interest rates
D) all of the above
E) none of the above


E

Economics

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Which of the following is a widely-used and closely-watched forecasting tool concerning the future direction of the macro-economy?

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Economics

Which of the following provides the clearest statement of the Ricardian equivalence theorem?

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A downward shift in the Fed's reaction function is equivalent to:

A. a decline in the Fed's long-term target for inflation. B. a downward shift of short-run aggregate supply. C. an upward shift of short-run aggregate supply. D. an increase in the Fed's long-term target for inflation.

Economics

An In the News article titled "Perceptions of Government Failure" implies that people lack confidence in the government. If this is true, it may be due to persistent examples of

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Economics