The Lucas Supply Function, in Combination with the Assumption That

question 67

Multiple Choice

The Lucas supply function, in combination with the assumption that expectations are rational, implies that if a monetary policy change is announced to the public,

• A) the change in real output will be positive.
• B) the change in real output will be negative.
• C) there will be no change in real output.
• D) Both A and B are possible, depending on they type of monetary policy change that has been announced.

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Definitions:

Attitude Accessibility

The ease with which an attitude can be retrieved from memory, impacting how quickly and consistently it influences an individual's response to related objects or situations.

Implicit Attitudes

Unconscious beliefs or feelings that may influence behavior and understanding, without conscious awareness.

Simple Attitude

A basic or uncomplicated viewpoint or belief about a person, object, or issue.

Complex Attitude

An attitude that contains both positive and negative components regarding an object, person, or issue.