Which of the Following Represents the AD Curve with a Financial

question 34

Multiple Choice

Which of the following represents the AD curve with a financial friction?

• A) \(\tilde { Y } _ { t } = \bar { a } - \bar { b } \bar { f } - \bar { b } \bar { m } \left( \pi _ { t } - \bar { \pi } \right)\)
• B) \(\tilde { Y } _ { t } = \bar { a } ( 1 + \bar { b } \bar { f } ) - \bar { b } \bar { m } \left( \pi _ { t } - \bar { \pi } \right)\)
• C) \(\tilde { Y } _ { t } = \frac { \bar { a } } { \bar { b } \bar { f } } - \bar { b } \bar { m } \left( \pi _ { t } - \bar { \pi } \right)\)
• D) \(\tilde { Y } _ { t } = \bar { a } - \bar { b } \bar { m } \left( \pi _ { t } - \bar { \pi } \right)\)
• E) \(\tilde { Y } _ { t } = \bar { a } \times \bar { b } \bar { f } + \bar { b } \bar { m } \left( \pi _ { t } - \bar { \pi } \right)\)

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