According the AS/AD model, in the long run, expansionary monetary policy will
a. increase both real GDP and the price level.
b. decrease both real GDP and the price level.
c. decrease the price level and leave real GDP unchanged.
d. increase the price level and leave real GDP unchanged.
e. increase real GDP and reduce the price level.
D
Economics
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What is the shape of the long-run aggregate supply curve? Why?
What will be an ideal response?
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A sharp rise in the real value of stock prices, which is independent of a change in the price level, would best be an example of:
A. The interest-rate effect B. The real-balances effect C. A change in the degree of excess capacity D. A change in real value of consumer wealth
Economics