Multiple Choice
The Great Moderation consensus regarding the use of monetary policy to fight recessions is that expansionary monetary policy:
A) is ineffective because the public expects it.
B) is harmful because it only increases the aggregate price level.
C) has little impact on aggregate demand because of liquidity traps.
D) can be used to increase aggregate demand but at the cost of higher aggregate prices.
Correct Answer:
Verified
Correct Answer:
Verified
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