If the Central Bank Raises the Rate at Which It

question 79

Multiple Choice

If the central bank raises the rate at which it increases the money supply,then in the short run unemployment is

• A)above its natural rate.The short-run Phillips curve shifts right as the economy moves back to its natural rate of unemployment.
• B)above its natural rate.The long-run Phillips curve shifts left as the economy moves back to its natural rate of unemployment.
• C)below its natural rate.The short-run Phillips curve shifts right as the economy moves back to its natural rate of unemployment.
• D)below its natural rate.The long-run Phillips curve shifts left as the economy moves back to its natural rate of unemployment.

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Definitions:

Previously Neutral

Refers to a stimulus that initially elicits no innate response until it is paired with an unconditioned stimulus in the learning process of classical conditioning.

Conditioned Response

A learned response to a previously neutral stimulus that has become associated with an unconditioned stimulus through conditioning.

Classical Conditioning

A learning process that occurs when two stimuli are repeatedly paired: a response that is at first elicited by the second stimulus is eventually elicited by the first stimulus alone.

Learned Reaction

A behavior or response that has been acquired through experience or conditioning.