If policymakers attempt to offset a favorable inflation shock with monetary ________, the resulting long-run equilibrium will be at ________ inflation rate compared to allowing the self-correcting mechanism return the economy to potential output.

A. easing; a lower
B. easing; a higher
C. tightening; a higher
D. tightening; a lower


Answer: D

Economics

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Using the equation of exchange, if the nominal GDP is $8,000 billion and the money supply is $1,600 billion, then

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