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Suppose the Economy Is Producing at the Natural Rate of Output

Question 10

Multiple Choice

Suppose the economy is producing at the natural rate of output. An increase in consumer and business confidence will cause ________ in real GDP in the short run and ________ in inflation in the short run,everything else held constant.


A) an increase;an increase
B) a decrease;a decrease
C) no change;an increase
D) no change;a decrease

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