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Which, if any, of the following statements are correct: (More than one option may be correct or may not be) 1) The combination of an

Which, if any, of the following statements are correct:

(More than one option may be correct or may not be)

1) The combination of an expansionary fiscal and monetary policy aims at decreasing the level of prices.

2) The combination of an expansionary monetary policy and a contractionary fiscal policy leads to an increase in the interest rates and a decrease in investment; however, the effect on AD is undefined.

3) A government may adopt an expansionary monetary policy without changing the nominal interest rates.

4) None of the other possible answers

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