Commercial banks are required by law to hold reserves. These reserves are specified as percentages of a bank's

Menu costs are a possible reason for

A) swings in the labor force participation rate. B) low levels of consumer confidence in response to aggregate supply shocks. C) aggregate supply shocks. D) sticky product prices.

According to the misperceptions theory, an unanticipated decrease in the money supply shifts the AD curve ________, causing output to ________ in the short run

A) up and to the right; rise B) up and to the right; fall C) down and to the left; rise D) down and to the left; fall