A Monetary Policy That Reduces Both Real and Nominal Income

question 239

Multiple Choice

A monetary policy that reduces both real and nominal income:

• A)must be expansionary.
• B)must be contractionary.
• C)cannot be expansionary or contractionary.
• D)could be expansionary or contractionary.

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Definitions:

Rational-legal

Rational-legal authority is a form of leadership where authority is legitimized by legal rules and regulations, and the power is attached to certain positions rather than individuals.

Charismatic

Possessing a compelling charm or appeal that inspires devotion or admiration in others.

Traditional

Adhering to or denoting ways of doing things that are passed down from generation to generation, often resistant to change.

Power Elite

A small group of powerful individuals who hold significant wealth, political influence, and authority in society, often shaping policy and decision-making.