The long-run neutrality of money refers to the fact that in the long run, monetary policy
A) changes only real output.
B) changes only the real interest rate.
C) changes both real output and the real interest rate.
D) has no effect on either real output or the real interest rate.
D
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If the Fed increases the interest rate in the U.S.:
A) the demand curve for dollars will shift to the left. B) the demand curve for dollars will shift to the right. C) the supply curve of dollars will shift to the right. D) the real exchange rate of the U.S. will depreciate.
Stagflation" refers to
A. a simultaneous increase in output and the price level. B. a simultaneous reduction in output and the price level. C. an increase in the price level accompanied by decreases or leveling off in real output and employment. D. a decline in the price level accompanied by increases in real output and employment.