Refer to the Following Figure to Answer the Following Questions

question 47

Multiple Choice

Refer to the following figure to answer the following questions.
-According to the figure,contractionary monetary policy starting at full-employment equilibrium will go from point ________ to point ________ in the short run and then to point ________ in the long run.

• A) A; D; A
• B) C; B; A
• C) A; D; C
• D) C; D; C
• E) C; D; A

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Definitions:

AAA Credit Rating

The highest credit rating assigned to a borrower's debt instruments by credit rating agencies, indicating an extremely low risk of default.

A Credit Rating

This is an evaluation of the credit risk of a prospective debtor, predicting their ability to pay back the debt and an implicit forecast of the likelihood of the debtor defaulting.

Note

Unsecured debt, usually with a maturity under 10 years.

Protective Covenant

A clause in a financial contract that restricts certain actions of the borrower to protect the lender's interests.