An Implication of Sticky Inflation Is That, Through Monetary Policy

question 121

Multiple Choice

An implication of sticky inflation is that, through monetary policy changes, the Federal Reserve:

• A) has no impact on inflation
• B) can alter the real interest rate in the long run
• C) can alter the real interest rate in the short run
• D) has no impact on the real interest rate
• E) has no impact on the unemployment rate

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