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    Principles of Economics Study Set 8
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    Exam 35: The Short-Run Tradeoff Between Inflation and Unemployment
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    What Would a Central Bank Need to Do to Reverse
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What Would a Central Bank Need to Do to Reverse

Question 52

Question 52

Essay

What would a central bank need to do to reverse the effects of a favorable supply shock on inflation? What would its reaction do to the unemployment rate in the short run?

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It would increase the money su...

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