A Bad Deflation Such as That Experienced by Japan Over

Multiple Choice

A bad deflation such as that experienced by Japan over the past decade poses problems

A) for monetary policy because it lowers the real interest rate below the nominal interest rate.
B) for fiscal policy because it raises the ratio of public debt to nominal GDP even if public debt is fixed.
C) for monetary and fiscal policy because it makes it impossible to use these together to shift the IS and LM curves rightward at the same time.
D) for monetary and fiscal policy because it makes it impossible to use these together to shift the IS and LM curves leftward at the same time.