Mainstream Macroeconomics Has Embraced the

question 95

Multiple Choice

Mainstream macroeconomics has embraced the

• A) rational expectations view that stabilization policy is totally ineffective.
• B) monetarist view that the Fed should increase the money supply at a fixed annual rate.
• C) rational expectations view that expectations can shift the aggregate demand and aggregate supply curves.
• D) monetarist view that an increase in government spending crowds out an equal amount of investment spending.

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