According to the Rational Expectations School,a Correctly Anticipated Expansionary Monetary

question 16

Multiple Choice

According to the rational expectations school,a correctly anticipated expansionary monetary policy will:

• A)increase prices and real output.
• B)increase real output only in the short run.
• C)have no effect on prices or real output.
• D)decrease prices and real output.
• E)lead only to a higher price level.

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