Multiple Choice
In the New Keynesian model, an increase in current government spending
A) increases output and leaves the real interest rate unchanged.
B) increases output and decreases the real interest rate.
C) decreases output and increases the real interest rate.
D) decreases output and decreases the real interest rate.
E) decreases output and increases the real wage rate.
Correct Answer:

Verified
Correct Answer:
Verified
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