According to the Misperceptions Theory,an Unanticipated Decrease in the Money

question 34

Multiple Choice

According to the misperceptions theory,an unanticipated decrease in the money supply shifts the AD curve ________,causing output to ________ in the short run.

• A)up and to the right; rise
• B)up and to the right; fall
• C)down and to the left; rise
• D)down and to the left; fall

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Definitions:

Constant Rate

A situation or condition in which a particular variable remains unchanged over a period of time.

Dividends

A corporation's distribution of profits to its shareholders as payments.

Paid

Refers to the status of a financial obligation that has been fulfilled or settled.

Constant Annual Dividend

This refers to dividends that are paid out to shareholders at a constant rate each year, without fluctuation.