Which of the Following Statements Is Most Accurate

question 27

Multiple Choice

Which of the following statements is most accurate?

• A) Monetary policy set to achieve money supply targets best insulates GDP from random shifts in the IS curve.
• B) Monetary policy set to achieve an interest rate target best insulates GDP from random shifts in the LM curve.
• C) Monetary policy set to achieve a money supply target represents a compromise that insulates GDP from simultaneous random shifts in both the IS curve and the LM curve.
• D) All of the above.
• E) Only a and b.

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