Suppose that the central bank 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 from long-run equilibrium and aggregate demand shifts right, the central bank must
a. increase the money supply so interest rates rise.
b. increase the money supply so interest rates fall.
c. decrease the money supply so interest rates rise.
d. decrease the moneys supply so interest rates fall
c
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Refer to the scenario above. The market for Good A in Eduland is an example of a ________
A) monopoly B) duopoly C) monopolistic competition D) perfect competition
Which of the following is an example of a "how much" decision?
A) Dinah's Diner is only open for breakfast and lunch. Dinah is trying to decide whether to open for dinner as well. B) Zander has torn up his front yard and is debating whether to plant grass or install a rock garden. C) You received a nice birthday check from your grandmother and are deciding on whether to spend it on a trip to New York or a trip to San Francisco. D) Sergio quit his job to go back to school full time.