In the New Classical View

question 89

Multiple Choice

In the new classical view,

• A) a change in the money supply will affect real GDP only if people anticipate the policy change.
• B) monetary policy can never change real GDP.
• C) using monetary policy will change real GDP only if the policy takes people by surprise.
• D) fiscal policy has more chance of success than monetary policy.

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Definitions:

Client

An individual or organization that engages the professional services or advice of another.

Best Judgment

The highest quality assessment or decision made based on knowledge and experience.

Plausibility

The quality or state of appearing reasonable or probable.

ImPlausibility

The quality of being unlikely or not believable based on current knowledge or understanding.