Consider the AD/AS Model with a Constant Rate of Inflation

question 66

Multiple Choice

Consider the AD/AS model with a constant rate of inflation.In this case,

• A)there is no effective set of monetary policy tools to reduce inflation.
• B)there is a tendency for the price of bonds to be increasing rapidly.
• C)the AS curve is shifting upward because of inflation expectations.
• D)expected inflation tends to be significantly less than actual inflation.
• E)the AD curve is not shifting at all.

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Definitions:

Evolutionary Explanation

A theory or account that proposes how certain traits or behaviors have developed over time through the process of natural selection.

Altruistic Gene

A hypothetical gene that influences individuals to act in a selfless manner for the benefit of others.

Biological Factors

Intrinsic physiological and genetic attributes that influence an individual's behavior, health, and development.

Prosocial Behaviour

Voluntary actions intended to benefit or help others without the expectation of external rewards.