An Upward Shift in the Fed's Reaction Function Is Equivalent

question 117

Multiple Choice

An upward shift in the Fed's reaction function is equivalent to:

• A)a decline in the Fed's long-term target for inflation.
• B)an increase in the Fed's long-term target for inflation.
• C)an upward shift of short-run aggregate supply.
• D)a downward shift of short-run aggregate supply.

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Definitions:

Right Frontal Lobe

A region of the brain associated with decision making, problem-solving, impulse control, and social interactions.

Left Frontal Lobe

The region of the brain associated with reasoning, motor skills, higher level cognition, and expressive language.

Right Temporal Lobe

A region of the brain located in the temporal lobe on the right hemisphere, instrumental in processing visual memory, emotion, and interpreting sounds.

Left Temporal Lobe

A part of the brain located on the left side involved in understanding language, memory, and the sequencing and organization of information.