According to New Keynesians, a Reduction in Which of the Following

question 100

Multiple Choice

According to New Keynesians, a reduction in which of the following will tend to cause the inflation rate to decrease?

• A)anticipated future inflation
• B)firms' average inflation adjusted per-unit costs of production
• C)an unexpected reduction in aggregate demand
• D)all of the above

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Definitions:

Stimulus Generalization

The process by which a conditioned response starts occurring in response to stimuli that are similar but not identical to the original conditioned stimulus.

Conditioned Response

A learned response to a previously neutral stimulus that has become associated with a stimulus that naturally evokes a response.

New Stimulus

An unfamiliar or novel trigger in the environment that has the potential to elicit a response from a person or an animal.

Hertz

A unit of frequency in the International System of Units (SI), symbolized as Hz, denoting one cycle per second.