If a recession persists due to nominal wage and price stickiness (i.e., slow adjustment of nominal wages downward), what kind of fiscal policy can bring us out of this recession? decreased government expenditures O decreased government expenditures and increased taxes increased government expenditures and decreased taxes O contractionary fiscal policy Question 18 (1 point) Over the last 10 years the Federal Reserve has substantially changed the way it operates. What is different about how the Federal Reserve now conducts policy? O it places fewer regulations on commercial banks O it discusses its policy in public and asks for guidance from Congress It is more secretive about interest rate and other policy changes O it gives the public forward guidance on what it will do Question 19 (1 point) What are the costs associated with large volatility in GDP? O bouts of high inflation and high unemployment rate O bouts of high interest rates and high national debt O bouts of low taxes and high government expenditures O bouts of high GDP growth and low inflation rate Question 20 (1 point) What types of shocks are thought to cause most of the fluctuations that are called business cycles (e.g., fluctuations in GDP]? OLRAS O AD Government Deficit SRAS