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Title: If a shock results in a positive output gap and the government's policy choice is to do nothing, Post by: ice5192 on Dec 10, 2017 If a shock results in a positive output gap and the government's policy choice is to do nothing,
A) the central bank will immediately increase the money supply and close the output gap. B) the price level will fall, the interest rate will fall, and output will rise, closing the gap. C) the government will immediately implement expansionary fiscal policy. D) the economy will be prevented from returning to equilibrium. E) it will be detrimental to the economy. Title: Re: If a shock results in a positive output gap and the government's policy choice is to do ... Post by: karmar on Dec 10, 2017 Content hidden
Title: Re: If a shock results in a positive output gap and the government's policy choice is to do nothing, Post by: ice5192 on May 21, 2018 Thanks!
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