Suppose the target rate of unemployment is 5 percent but the actual rate of unemployment is 2 percent. Given this information, which of the following policies is the least appropriate according to the AS/AD model? A, contractionary monetary policy B. an increase in the value of the dollar to decrease exports C. an increase in interest rates from the central bank D. None of the available answers. E. expansionary monetary policy
Suppose the target rate of unemployment is 5 percent but the actual rate of unemployment is 2 percent. Given this information, which of the following policies is the least appropriate according to the AS/AD model? A, contractionary monetary policy B. an increase in the value of the dollar to decrease exports C. an increase in interest rates from the central bank D. None of the available answers. E. expansionary monetary policy
Chapter27: Issues In Macroeconomic Theory And Policy
Section: Chapter Questions
Problem 2P
Related questions
Question
Suppose the target rate of
A, contractionary
B. an increase in the value of the dollar to decrease exports
C. an increase in interest rates from the central bank
D. None of the available answers.
E. expansionary monetary policy
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