In the Case of a Negative Shock to Aggregate Demand,the

question 220

Multiple Choice

In the case of a negative shock to aggregate demand,the central bank should:

• A) decrease the rate of growth of the money supply to control inflation.
• B) increase the rate of growth of the money supply to restore spending growth.
• C) decrease the rate of growth of the price level to keep real growth high.
• D) do nothing.

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