What is the main difference between a demand shock stemming from monetary policy and a demand shock that comes from a change in spending?
A)In the short-run,an autonomous monetary policy easing lowers real interest rates and raises aggregate output whereas a positive spending shock has the opposite effect on both variables.
B)An autonomous monetary policy easing raises inflation permanently whereas a positive spending shock only raises inflation temporarily.
C)An autonomous monetary policy easing has a temporary effect on the real interest rate whereas a positive spending shock has a permanent effect on the real interest rate.
D)all of the above
E)none of the above

Question

Quizplus · Accepted Answer

The Answer of What is the main difference between a demand shock stemming from monetary policy and a demand shock that comes from a change in spending?
A)In the short-run,an autonomous monetary policy easing lowers real interest rates and raises aggregate output whereas a positive spending shock has the opposite effect on both variables.
B)An autonomous monetary policy easing raises inflation permanently whereas a positive spending shock only raises inflation temporarily.
C)An autonomous monetary policy easing has a temporary effect on the real interest rate whereas a positive spending shock has a permanent effect on the real interest rate.
D)all of the above
E)none of the above

What Is the Main Difference Between a Demand Shock Stemming