Multiple Choice
Which statement is true when rational expectations exist and there is a change in monetary policy which is unexpected?
A) The change in monetary policy leads to a change in aggregate demand that leads to a temporary short-run equilibrium that is different from the long-run equilibrium.
B) The change in monetary policy leads to a simultaneous shift of the short-run aggregate supply curve.
C) The change in monetary policy lead to a simultaneous shift in the long-run aggregate supply curve.
D) The change in monetary policy does not change equilibrium in either the short-run or long-run.
Correct Answer:

Verified
Correct Answer:
Verified
Q22: Which of the following curves shows the
Q38: When the economy is at its natural
Q104: When it comes to active policymaking most
Q111: In the short run, an unanticipated cut
Q202: <img src="https://d2lvgg3v3hfg70.cloudfront.net/TB5013/.jpg" alt=" -In the above
Q236: The hypothesis that people combine the effects
Q249: An unexpected increase in aggregate demand<br>A)causes the
Q264: The hypothesis stating that people combine the
Q305: The Phillips curve shows<br>A)the relationship between the
Q308: Menu costs are a possible reason for<br>A)