Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Question 39 {1.25 points] Which of the following will me Inconsistency cause? Q It will cause the longrun Phillips curve to he farther to the
Question 39 {1.25 points] Which of the following will me Inconsistency cause? Q It will cause the longrun Phillips curve to he farther to the left than it otherwise would. Q It will cause the shortrun Phillips curve to be lower than it otherwise would Q It will cause the longrun Phillips curve to he farther to the right than it otherwise would. Q It will cause the shortrun Phillips curve to be higher than it otherwise would. Question 40 (1.25 points] Consider a scenario in which the central hank must follow a rule that requires it to increase the money supply when the price level falls and decrease the money supply when the price level rises. If the economy starts om longrun equilibrium and aggregate demand shis right, what must the central bank do, and what will happen to output? O The central bank must increase the money supply, which will move output back toward its longrun level. O The central bank must increase the money supply, which will move output farther om its longrun level. O The central bank must decrease the money supply, which will move output farther from its longrun level. O The central bank must decrease the money supply, which will move output back toward its longrun level
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started