Multiple Choice
Monetary Policy in Mokania
Mokania has had inflation of 15% for many years. Mokania establishes a new central bank, the Bank of Mokania, with the hopes of reducing the inflation rate.
-Refer to Monetary Policy in Mokania.The Bank of Mokania publicizes that it intends to reduce the inflation rate to 5%.If Mokanians lower their inflation expectations,which curve shifts to the left?
A) both the short-run and the long-run Phillips curves
B) neither the short-run nor the long-run Phillips curves
C) only the short-run Phillips curve
D) only the long-run Phillips curve
Correct Answer:
Verified
Correct Answer:
Verified
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