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★ѕραndavir ★ѕραndavir
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6 years ago
From an initial long-run equilibrium with zero nominal demand growth, nominal GDP growth rises to a permanent 9 percent. If we assume adaptive expectations with a one-period lag, the dynamic process in response to the demand growth is
A) a loop that eventually terminates at Y = 100 with 9 percent inflation.
B) a loop that eventually terminates at Y = 100 with zero percent inflation.
C) a straight path to the northeast until we reach Y = 109 with 9 percent inflation.
D) in the first period Y = 109 with zero inflation, and every period thereafter Y =100 with 9 percent inflation.
Textbook 
Macroeconomics

Macroeconomics


Edition: 12th
Author:
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thecromthecrom
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★ѕραndavir Author
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6 years ago
Helped a lot
Holly72492
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Yesterday
this is exactly what I needed
gma_of_7
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2 hours ago
Good timing, thanks!
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