If the Aggregate Supply Curve Is Flat

question 195

Multiple Choice

If the aggregate supply curve is flat,

• A)contractionary fiscal or monetary policy will reduce inflation with little effect on real GDP.
• B)contractionary fiscal or monetary policy will cause significantly less inflation.
• C)expansionary fiscal or monetary policy will add significantly to real GDP will little effect on inflation.
• D)expansionary fiscal or monetary policy will add little to real GDP but will increase inflation significantly.

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