In regards to the time lags that we discussed, which lag is likely to be the most troublesome for Fiscal Policy? O A. Money Time Lag O B. Legislative Lag O C. Effectiveness Lag O D. Data Lag Suppose that there is a positive aggregate demand shock and the central bank commits to an inflation rate target. But if the commitment is not credible, then . . . O A. over time inflation will fall back down to the inflation target. O B. the short - run aggregate supply curve will rise. O C. the public's expected inflation will remain unchanged. O D. all of the above. O E. both A and B.Under a negative demand shock with a fully credible monetary policy. the AD curve and the AS curve in the short run. if} A. shifts left; shifts up Q) B. shifts left; does not shift C) C. shifts right; shifts up (3': D. shifts right; does not shift 0n the graph to the right, point V represent the short run effect of an aggregate demand shock if monetary policy is not credible. Yp Y3 Y2 Aggregate Output, Y In regards to the time legs that we discussed, which lag is likely to be the most troublesome for Monetary Policy? (:3 A. Money Time Lag (V) B. Data Lag {'9} C. Legislative Lag {:3 D. Effectiveness Lag When The Fed initiates contractionary policy, which of the following multiple events will occur? cj 3 A. Real interest rates will increase, stock prices will increase and moral hazard will increase. {on B. Lending activity decreases, stock prices will decrease and the volume of bank loans will decrease. c: j) C. Real interest rates will decrease, bank deposits will increase and the volume of bank loans will increase. ii") D. Real interest rates will decrease, stock prices will increase and the dollar will appreciate in value