In the New Keynesian Model,an Unanticipated Increase in the Money

question 25

Multiple Choice

In the new Keynesian model,an unanticipated increase in the money supply causes

• A)aggregate demand to increase along a stationary aggregate supply curve.
• B)both aggregate demand and supply to increase.
• C)aggregate demand to increase as aggregate supply decreases.
• D)both aggregate demand and supply to decrease.

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Definitions:

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