If the Government Increased the Money Supply in Response to a Decrease

question 244

True/False

If the government increased the money supply in response to a decrease in short-run aggregate supply,unemployment would return towards its natural rate,but prices would rise even more.

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Definitions:

Short-term Memory

The short-duration, limited-capacity memory component in which selected input from the memory store is worked on.

Sensory Memory

A very short-term memory that holds sensory information, allowing individuals to retain impressions of sensory information after the original stimulus has ceased.

Encoded

The process of converting information into a different form or code, usually for the purpose of secrecy, storage, or transmission.

Daydreaming

The act of detaching from one's immediate surroundings to envision scenarios, often reflecting desires, hopes, or creative thoughts.