Author Question: If prices in the New Keynesian model were perfectly flexible, then A) there would be a role for ... (Read 37 times)

corkyiscool3328 · **on:** Jun 30, 2018

If prices in the New Keynesian model were perfectly flexible, then

A) there would be a role for monetary policy.
B) the output gap would be positive.
C) the equilibrium real interest rate would be the natural rate of interest.
D) the output gap would be negative.

Question 2

The slope of the output per worker function is equal to the

A) marginal product of capital.
B) marginal product of labor.
C) savings rate.
D) growth rate of the population.