Suppose that,in an economy,ADI = 800 + 0.9Y - 20,000r,and the central bank acts according to the following monetary policy rule:
If inflation is 1%,the central bank will set a real interest rate of ________%,and short-run equilibrium output will be equal to _________.
A) 0;8,000
B) 1;8,000
C) 1;6,000
D) 1.5;5,000
E) 1.5;8,000

Question

Suppose that,in an economy,ADI = 800 + 0.9Y - 20,000r,and the central bank acts according to the following monetary policy rule: 
If inflation is 1%,the central bank will set a real interest rate of ________%,and short-run equilibrium output will be equal to _________.
A) 0;8,000 
B) 1;8,000 
C) 1;6,000 
D) 1.5;5,000 
E) 1.5;8,000

Quizplus · Accepted Answer

The Answer of Suppose that,in an economy,ADI = 800 + 0.9Y - 20,000r,and the central bank acts according to the following monetary policy rule: 
If inflation is 1%,the central bank will set a real interest rate of ________%,and short-run equilibrium output will be equal to _________.
A) 0;8,000 
B) 1;8,000 
C) 1;6,000 
D) 1.5;5,000 
E) 1.5;8,000

Suppose That,in an Economy,ADI = 800 + 0