This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: If the economy is in a long-run equilibrium when the Federal Reserve decides that its inflation ... (Read 63 times)

tiffannnnyyyyyy

  • Hero Member
  • *****
  • Posts: 512
on: Jun 30, 2018
If the economy is in a long-run equilibrium when the Federal Reserve decides that its inflation target is too low and chooses to raise it, ________.
 
  A) it would likely conduct a tightening of monetary policy by raising the real interest rate for any given inflation rate
  B) it would likely conduct an easing of monetary policy by lowering the real interest rate for any given inflation rate
  C) it would likely conduct an easing of monetary policy where the real interest rate would increase due to the ensuing decrease in aggregate demand
  D) it would likely conduct a tightening of monetary policy where the real interest rate would increase due to the ensuing increase in aggregate demand
  E) none of the above

Question 2

Real business cycle theory was introduced by
 
  A) Milton Friedman and Robert Lucas.
  B) Milton Friedman and Anna Schwartz.
  C) Thomas Cooley and Gary Hansen.
  D) Finn Kydland and Edward Prescott.


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

jgranad15

  • Sr. Member
  • ****
  • Posts: 345
Reply #1 on: Jun 30, 2018
Answer to Question 1

B

Answer to Question 2

D


tiffannnnyyyyyy

  • Member
  • Posts: 512
Reply 2 on: Jun 30, 2018
Excellent

TheDev123

  • Member
  • Posts: 332
Reply 3 on: Yesterday
:D TYSM

« previous next »
 

Did you know?

A strange skin disease referred to as Morgellons has occurred in the southern United States and in California. Symptoms include slowly healing sores, joint pain, persistent fatigue, and a sensation of things crawling through the skin. Another symptom is strange-looking, threadlike extrusions coming out of the skin.

Did you know?

The eye muscles are the most active muscles in the whole body. The external muscles that move the eyes are the strongest muscles in the human body for the job they have to do. They are 100 times more powerful than they need to be.

Did you know?

The horizontal fraction bar was introduced by the Arabs.

Did you know?

Malaria mortality rates are falling. Increased malaria prevention and control measures have greatly improved these rates. Since 2000, malaria mortality rates have fallen globally by 60% among all age groups, and by 65% among children under age 5.

Did you know?

The liver is the only organ that has the ability to regenerate itself after certain types of damage. As much as 25% of the liver can be removed, and it will still regenerate back to its original shape and size. However, the liver cannot regenerate after severe damage caused by alcohol.

A 3-tonne (3.0-long-ton; 3.3-short-ton) great white shark off Isla Guadalupe A 3-tonne (3.0-long-ton; 3.3-short-ton) great white shark off Isla Guadalupe
the comet Encke riding along its pebbly trail of debris (long diagonal line) between the orbits of M the comet Encke riding along its pebbly trail of debris (long diagonal line) between the orbits of M
Levels of Processing Affects Long-Term but not Short-Term Memory Levels of Processing Affects Long-Term but not Short-Term Memory
Kinesthesis and Equilibrium with skating Kinesthesis and Equilibrium with skating
A wave whose wavelength is 0.500 m is traveling down a 500-m long wire whose total mass is 25 ... A wave whose wavelength is 0.500 m is traveling down a 500-m long wire whose total mass is 25 ...
Video: Tuberculosis Testing

For a complete list of videos, visit our video library