Author Question: If the economy is growing beyond potential real GDP, which of the following would be an appropriate ... (Read 109 times)

chads108 · **on:** Jun 29, 2018

If the economy is growing beyond potential real GDP, which of the following would be an appropriate fiscal policy to bring the economy back to long-run aggregate supply? An increase in

A) the money supply and a decrease in interest rates.
B) taxes.
C) oil prices.
D) government purchases.

Question 2

Most of the pressure for a monetary growth rule has disappeared because since 1980

A) the relationship between movements in interest rates and movements in real GDP and the price level have become much weaker.
B) the relationship between movements in the money supply and movements in real GDP and the price level have become much stronger.
C) the relationship between movements in the money supply and movements in real GDP and the price level have become much weaker.
D) the relationship between movements in interest rates and movements in real GDP and the price level have become much stronger.