If,in the Coordination Failure Model,the Nominal Money Supply Acts as a Sunspot

question 25

Multiple Choice

If,in the coordination failure model,the nominal money supply acts as a sunspot variable,then it is likely that the nominal money supply would

• A) be procyclical.
• B) be acyclical.
• C) be countercyclical.
• D) alternatively appear to be procyclical and countercyclical.

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Definitions:

Authority

The power or right to give orders, make decisions, and enforce obedience.

Social Institutions

Systems and structures within society that shape the activities of groups and individuals.

Structures

The arrangement or organization of interrelated elements in a material object or system, also applicable to abstract entities like societies.

Society

A group of individuals involved in persistent social interaction, or a large social group sharing the same geographical or social territory, typically subject to the same political authority and dominant cultural expectations.