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If the Short-Run Aggregate Supply Curve Is Assumed to Be

Question 21

Multiple Choice

If the short-run aggregate supply curve is assumed to be horizontal and money demand is proportional to income, then the big, comprehensive model in the appendix to Chapter 14 corresponds to which of the following special cases?


A) classical closed economy
B) aggregate demand and aggregate supply
C) IS-LM model
D) Mundell-Fleming model with floating exchange rate

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