According to the New Keynesian Sticky-Price Theory, a Rise in Aggregate

question 24

Multiple Choice

According to the new Keynesian sticky-price theory, a rise in aggregate demand results in ________ price level in the near term and in ________ price level in the longer term.

• A) a higher; an unchanged
• B) an unchanged; a higher
• C) a lower; an unchanged
• D) a lower; a higher

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Definitions:

Variables

Elements, features, or factors that are capable of changing or varying across different conditions or within different individuals in a study.

Population Standard Deviation

A measure of the dispersion of a dataset relative to its mean, calculated for the entire population.

Symbols

Characters or graphical figures used to represent objects, quantities, or concepts.

Population

The entire pool from which a statistical sample is drawn and to which the results of analysis apply.