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In: Economics

Under a negative demand shock with a fully credible monetary policy, the AD curve _______ and the AS curve _______ in the short run LRAS


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Under a negative demand shock with a fully credible monetary policy, the AD curve _______  and the AS curve _______  in the short run LRAS 

 A. shifts right shifts up 

 B. shifts right, does not shift 

 C. shifts left: does not shift 

 D. shifts left shifts up


On the graph to the right, point _______  represent the short run effect of an aggregate demand shock if monetary policy is not credible.

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Expert Solution

Rahul Sunny answered 2 years ago
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