A Decrease in the Inflation Target by the Central Bank

question 102

Multiple Choice

A decrease in the inflation target by the central bank would:

• A)Have no impact on the positioning of the dynamic aggregate demand curve
• B)Cause the dynamic aggregate demand curve to shift to the left
• C)Cause the dynamic aggregate demand curve to shift to the right
• D)Be reflected by a movement down and along the existing dynamic aggregate demand curve

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