The Keynesian Mechanism Through Which Monetary Policy Affects the Price

question 40

Multiple Choice

The Keynesian mechanism through which monetary policy affects the price level, real GDP, and employment depends on the impact of the:

• A) interest rate on savings.
• B) inflation on investment.
• C) interest rate on investment.
• D) interest rate on bond prices.

---

Definitions:

Biased

Showing an unfair preference or prejudice for or against something or someone.

Internal Validity

The extent to which a study can demonstrate a cause-and-effect relationship between its variables.

Epidemiological Study

Research conducted to understand the distribution and determinants of health-related states or events in specific populations, and to apply this study to control health problems.

Case Study

An in-depth analysis of an individual, group, event, or situation to explore and understand its complexities.