overall money e. none of these 6. In order to counter economic recessions, which of the following monetary policy should be used? a. the central bank purchases bonds and the interest rate increases. b. the central bank purchases bonds and the interest rate decreases. c. the central bank sells bonds and the interest rate increases. d. the central bank sells bonds and the interest rate decreases. 7. The sticky-wage theory of the short-run aggregate supply curve says that when the price level rises more than expected, production is a. more profitable and employment and output rises. b. more profitable and employment and output falls. c. less profitable and employment and output rises. d. less profitable and employment and output falls Figure 1