The ADI-IA Model Differs from the Basic Keynesian Model

Multiple Choice

The ADI-IA model differs from the basic Keynesian model

A) only in that it assumes that the price level is flexible in the short run.
B) only in that it incorporates a central bank policy reaction function.
C) only in that it incorporates a self-correcting mechanism.
D) only in that it can explain how the inflation rate is determined.
E) in that it assumes that the price level is flexible in the short run,it incorporates a central bank policy reaction function,it incorporates a self-correcting mechanism,and it can explain how the inflation rate is determined.