Solved

Suppose That,in an Economy,ADI = 800 + 0

Question 115

Multiple Choice

Suppose that,in an economy,ADI = 800 + 0.9Y - 20,000r,and the central bank acts according to the following monetary policy rule: Suppose that,in an economy,ADI = 800 + 0.9Y - 20,000r,and the central bank acts according to the following monetary policy rule: If inflation is 0%,the central bank will set a real interest rate of ________%,and short-run equilibrium output will be equal to _________. A) 0;8,000 B) 1;8,000 C) 1;6,000 D) 1;5,000 E) 1.5;5,000
If inflation is 0%,the central bank will set a real interest rate of ________%,and short-run equilibrium output will be equal to _________.


A) 0;8,000
B) 1;8,000
C) 1;6,000
D) 1;5,000
E) 1.5;5,000

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Q110: An increase in the inflation rate corresponds

Q111: <img src="https://d2lvgg3v3hfg70.cloudfront.net/TB3713/.jpg" alt=" -Based on the

Q112: To reduce inflation in an economy at

Q113: A downward shift of the Bank of

Q114: Which of the following will shift the

Q116: Graphically,inflation shocks shift the _ and shocks

Q117: All else being equal,an increase in the

Q118: Inflation shocks and shocks to potential output

Q119: An inflation shock is<br>A) the level of

Q120: Changes in autonomous aggregate demand and the