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10.00 points Economy A and Economy B are similar in every way except that in Economy A, 35 percent of aggregate expenditure is sensitive to

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10.00 points Economy A and Economy B are similar in every way except that in Economy A, 35 percent of aggregate expenditure is sensitive to changes in the real interest rate and in Economy B, 50 percent of aggregate expenditure is sensitive to changes in the reel interest rate. a. Which economy will have a steeper aggregate expenditure curve? EconomClick to select) w will have a steeper aggregate expenditure curve. For a given fall in the real interest rate, aggregate expenditure will increase (Click to select) in Economy A and so the curve is onomy B. (Click t b. How would the dynamic aggregate demand curves differ given that the monetary policy reaction curve is the same in both countries? Economy (Click to select) will have a steeper dynamic aggregate demand curve. Since the two countries have the same monetary policy reaction curve, an increase in inflation will result in the same increase in the real interest rate in both countries. This change in the real interest rate will result in a (Click to select) change in aggregate output in Economy A, resulting in a (Click to select)dynamic aggregate demand curve. 7. value: 10.00 points Economy A and Economy B are similar in every way except that in Economy A, 35 percent of aggregate expenditure is sensitive to changes in the real interest rate and in Economy B, 50 percent of aggregate expenditure is sensitive to changes in the real interest rate. a. Which economy will have a steeper aggregate expenditure curve? (Click to select Economy (Click to select)wll have a steeper aggregate expenditure curve. For a given fall in the real interest rate, aggregate expenditure will incr (Click to select)than in EconomyB in Economy A and so the curve is less b. How would the dynamic aggregate demand curves differ given that the monetary policy reaction curve is the same in both countries? Economy (Click to select) will have a steeper dynamic aggregate demand curve. Since the two countries have the same monetary policy reaction curve, an increase in inflation will result in the same increase in the reel interest rate in both countries. This change in the real interest rate will result in a (Click to select) change in aggregate output in Economy A, resulting in a (Click to select) dynamic aggregate demand curve. 10.00 points Economy A and Economy B are similar in every way except that in Economy A, 35 percent of aggregate expenditure is sensitive to changes in the real interest rate and in Economy B, 50 percent of aggregate expenditure is sensitive to changes in the real interest rate. 0. Which economy will have a steeper aggregate expenditure curve? Economy (Click to select) will have a steeper aggregate expenditure curve. For a given fall in the real interest rate, aggregate expenditure will increase (Click to select) in Economy A and so the curve is (Click to select) flatter steeper than in Economy B. ynamic aggregate demand curves differ given that the monetary policy reaction curve is the same in both countries? Economy (Click to select)will have a steeper dynamic aggregate demand curve. Since the two countries have the same monetary policy reaction curve, an increase in inflation will result in the same increase in the real interest rate in both countries. This change in the real interest rate will result in a (Click to select) change in aggregate output in Economy A, resulting in a (Click to seleco dynamic aggregate demand curve 10.00 points Economy A and Economy B are similar in every way except that in Economy A, 35 percent of aggregate expenditure is sensitive to changes in the real interest rate and in Economy B, 50 percent of aggregate expenditure is sensitive to changes in the real interest rate. 8 8. Which economy will have a steeper aggregate expenditure curve? Economy (Click to select) will have a steeper aggregate expenditure curve. For a given fall in the real interest rate, aggregate expenditure will increase (Click to select)in Economy A and so the curve is Economy B. (Click to select) than in b. How would the dynamic aggregate demand curves differ given that the monetary policy reaction curve is the same in both countries? will have a steeper dynamic aggregate demand curve. Since the two countries have the same monetary policy reaction curve, an increase in inflation will result in the same increase countries. This change in the real interest rate will result in a (Click to select) change in aggregate output in Economy A, resulting in a(Cick to select) dynamic aggregate select) in the re B demand A 1. 10.00 points Economy A and Economy B are similar in every way except that in Economy A, 35 percent of aggregate expenditure is sensitive to changes in the real interest rate and in Economy B, 50 percent of aggregate expenditure is sensitive to changes in the real interest rate. a. Which economy will have a steeper aggregate expenditure curve? Economy (Click to select)will have a steeper aggregate expenditure curve. For a given fall in the real interest rate, aggregate expenditure will increase (Click to select)in Economy A and so the curve is (Click to select) than in Economy B b. How would the dynamic aggregate demand curves differ given that the monetary policy reaction curve is the same in both countries? Economy (Click to select)will have a steeper dynamic aggregate demand curve. Since the two countries have the same monetary policy reaction curve, an increese in inflation will result in the same increase el yna c aggregate esulting in a Click the real interest rate in both countries. This change in the real interest rate wil result n demand curve. s This change in aggregate output in Economy A b 990 smaller value: 10.00 points Economy A and Economy B are similar in every way except that in Economy A, 35 percent of aggregate expenditure is sensitive to changes in the real interest rate and in Economy B, 50 percent of aggregate expenditure is sensitive to changes in the real interest rate. a. Which economy will have a steeper aggregate expenditure curve? Economy (Click to select)will have a steeper aggregate expenditure curve. For a given fall in the real interest rate, aggregate expenditure will increase (Click to select) than in Economy B. (Click to select) in Economy A and so the curve is b. How would the dynamic aggregate demand curves differ given that the monetary policy reaction curve is the same in both countries? Economy (Click to select)will have a steeper dynamic aggregate demand curve. Since the two countries have the same monetary policy reaction curve, an increase in inflation will result in the same increase in the real interest rate in both countries. This change in the real interest rate will result in a (Click to select) change in aggregate output in Economy A, resulting in(Click to select) dynamic aggregate demand curve. flatter steeper

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