Monetary policy has no effect on the equilibrium interest rate if
A) the inflation rate is zero.
B) the economy is in the liquidity trap.
C) velocity is constant.
D) the economy is at full employment.
Correct Answer:
Verified
Q1: When the LM curve is vertically sloped,
Q2: With velocity constant, an increase in the
Q3: With velocity constant and equal to 2,
Q5: If velocity is constant and equal to
Q6: If investment becomes more interest-sensitive,
A) monetary policy
Q7: Monetary policy has no effect on equilibrium
Q8: If you believe that the LM curve
Q9: If you believe that the LM curve
Q10: If the LM function is vertical, then
Q11: Monetarists argue that aggregate demand is
A) vertical.
B)
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