No distinction is made between the effects of anticipated and unanticipated policy in ________.
A) traditional Keynesian theory
B) new Keynesian theory
C) real business cycle theory
D) traditional Keynesian and real business cycle theory
Question 2
We collapse the consumer's current-period and future-period budget constraints into a single lifetime budget constraint by
A) assuming no default.
B) substituting for savings.
C) eliminating consumption smoothing.
D) assuming the consumer knows the future.
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