Question 12.

QUESTION 12 Suppose the economy is in a Keynesian recession and the Fed implements monetary policy in order to try to stimulate the economy. What does the Keynesian short run model predict the impact of this policy on the quantities of the following will be? Options are same, increase, decrease, or depends (please use exactly these words). Compared to the starting values in the recession (2 points each): Output Employment Consumption National saving Private saving Investment Real interest rate Price level