At time t=0, Rs= 10%, Re= 10%, and Es/e=E®s/E=1 Assume the Reserve Bank of Australia (RBA) temporarily increases money supply in Australia by 15% at time t-1. In addition, assume the following: 1. The increase in money supply by RBA at t=1 was not anticipated at t=0 2. The RBA completely reverses the increase in money supply at time t=2. That is, the level of money supply at t=2 is the same as at t=0. 3. The temporary change in money supply has no effect on prices in the short or long run 4. Output is always fixed at Y 5. ESJE-1 at time t=1 and t=2 6. RE= 10% at t=1 and t=2 Select the most appropriate option: O A. RS>15% and E$/E>1 at t=1 and Rs=10% and Es/€=1 at t=2 O B. R$<10% and E$/E>1 at t=1 and Rs=10% and Es/€=1 at t=2 OC. R$<10% and E$/€<1 at t=1 and R$<10% and Es/€<1 at t=2 O D. R$<15% and E$/€=1 at t=1 and Rs=10% and Es/€=1 at t=2 O E. R$>10% and E$/€>1 at t=1 and Rs>10% and Es/€>1 at t=2

At time t=0, Rs= 10%, Re= 10%, and Es/e=E®s/E=1 Assume the Reserve Bank of Australia (RBA) temporarily increases money supply in Australia by 15% at time t-1. In addition, assume the following: 1. The increase in money supply by RBA at t=1 was not anticipated at t=0 2. The RBA completely reverses the increase in money supply at time t=2. That is, the level of money supply at t=2 is the same as at t=0. 3. The temporary change in money supply has no effect on prices in the short or long run 4. Output is always fixed at Y 5. ESJE-1 at time t=1 and t=2 6. RE= 10% at t=1 and t=2 Select the most appropriate option: O A. RS>15% and E$/E>1 at t=1 and Rs=10% and Es/€=1 at t=2 O B. R$<10% and E$/E>1 at t=1 and Rs=10% and Es/€=1 at t=2 OC. R$<10% and E$/€<1 at t=1 and R$<10% and Es/€<1 at t=2 O D. R$<15% and E$/€=1 at t=1 and Rs=10% and Es/€=1 at t=2 O E. R$>10% and E$/€>1 at t=1 and Rs>10% and Es/€>1 at t=2

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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