A C Inflation rate, n' Inflation Inflation 4.5 4 3.5 3 2.5 2 1 2 VPC 6 Select one or more: O Chart A Chart B Chart C Chart D 9 8 PC = n¹ MR 11 Output, Y B Inflation Inflation 13 15 17 19 12 14 16 18 20 4.5 4 L 2 4 6 8 10 12 Time period 3.5 3 25 2 10 Time period Figure 14 Policy response to a positive demand shock D Inflation VPC H n² rate, 9 11 13 15 17 19 14 16 18 20 Figure 14 shows four charts labelled A to D depicting aspects of a positive permanent demand shock. Charts B and C are from the DD209 macrosimulator, while Charts A and D show MR curves. Which two of these charts are consistent with the policy response from a central bank that has a strong inflation aversion? (Choose two answers.) MR PC = n¹ Output,
A C Inflation rate, n' Inflation Inflation 4.5 4 3.5 3 2.5 2 1 2 VPC 6 Select one or more: O Chart A Chart B Chart C Chart D 9 8 PC = n¹ MR 11 Output, Y B Inflation Inflation 13 15 17 19 12 14 16 18 20 4.5 4 L 2 4 6 8 10 12 Time period 3.5 3 25 2 10 Time period Figure 14 Policy response to a positive demand shock D Inflation VPC H n² rate, 9 11 13 15 17 19 14 16 18 20 Figure 14 shows four charts labelled A to D depicting aspects of a positive permanent demand shock. Charts B and C are from the DD209 macrosimulator, while Charts A and D show MR curves. Which two of these charts are consistent with the policy response from a central bank that has a strong inflation aversion? (Choose two answers.) MR PC = n¹ Output,
Principles of Macroeconomics (MindTap Course List)
8th Edition
ISBN:9781305971509
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter21: The Influence Of Monetary And Fiscal Policy On Aggregate Demand
Section: Chapter Questions
Problem 5CQQ
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