If the Central Bank Raises the Rate at Which It

question 79

Multiple Choice

If the central bank raises the rate at which it increases the money supply,then in the short run unemployment is

• A)above its natural rate.The short-run Phillips curve shifts right as the economy moves back to its natural rate of unemployment.
• B)above its natural rate.The long-run Phillips curve shifts left as the economy moves back to its natural rate of unemployment.
• C)below its natural rate.The short-run Phillips curve shifts right as the economy moves back to its natural rate of unemployment.
• D)below its natural rate.The long-run Phillips curve shifts left as the economy moves back to its natural rate of unemployment.

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Definitions:

Conditioned Stimulus

A previously neutral stimulus that, after association with an unconditioned stimulus, elicits a conditioned response.

Unconditioned Response

The automatic or natural reaction to a stimulus in classical conditioning, which occurs without the necessity for prior learning.

Conditioned Response

A learned response to a previously neutral stimulus after it has been repeatedly associated with an unconditioned stimulus.

Behavioral Perspective

An approach in psychology that focuses on observable behaviors, emphasizing the effects of learning and environment on actions.