Multiple Choice
Assume that the economy begins in long-run equilibrium.Then the Bank of Canada reduces the money supply.In the short run ______,whereas in the long run prices ______ and output returns to its original level.
A) output decreases and prices are unchanged; rise
B) output decreases and prices are unchanged; fall
C) output and prices both decrease; rise
D) output and prices both decrease; fall
Correct Answer:
Verified
Correct Answer:
Verified
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