An inflation rate above the target rate will result in:
A. a movement up along the monetary policy reaction curve and a rightward shift of the dynamic aggregate demand curve.
B. a movement up along the monetary policy reaction curve and a leftward shift of the dynamic aggregate demand curve.
C. a movement up along the monetary policy reaction curve and a movement up the dynamic aggregate demand curve.
D. a movement down along the monetary policy reaction curve and a movement down the dynamic aggregate demand curve.
Answer: C
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When the nation of Duxembourg allows trade and becomes an importer of software,
a. residents of Duxembourg who produce software become worse off; residents of Duxembourg who buy software become better off; and the economic well-being of Duxembourg rises. b. residents of Duxembourg who produce software become worse off; residents of Duxembourg who buy software become better off; and the economic well-being of Duxembourg falls. c. residents of Duxembourg who produce software become better off; residents of Duxembourg who buy software become worse off; and the economic well-being of Duxembourg rises. d. residents of Duxembourg who produce software become better off; residents of Duxembourg who buy software become worse off; and the economic well-being of Duxembourg falls.
Refer to the given information. If nominal GDP is $200 and the interest rate is 6 percent, the total amount of money that households and businesses will want to hold is:
Answer the question on the basis of the following information. For transactions, households
and businesses want to hold an amount of money equal to one-half of nominal GDP. The table
shows the amounts of money they want to hold as an asset at various interest rates.
A. $120.
B. $140.
C. $160.
D. $180.