Question
8. Suppose the Federal Reserve decreases interest rates from 4 to 3 percent which leads to an increase in short-run output of 1.5 percent. If
8. Suppose the Federal Reserve decreases interest rates from 4 to 3 percent which leads to
an increase in short-run output of 1.5 percent. If there are no other shocks to the
economy, and the resulting change in the rate of inflation is from 2% to 2.75%, what is
the value of ?
a. 4
b. 0.5
c. 0.25
d. 0.66
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Basic Econometrics
Authors: Damodar N. Gujrati, Dawn C. Porter
5th edition
73375772, 73375779, 978-0073375779
