According to the theory of new classical economics, if business sentiment and investment spending decrease, the aggregate demand curve _____, the price level falls, and aggregate output _____.
A) shifts right; increases
B) shifts left; remains constant
C) shifts right; decreases
D) shifts left; decreases
Correct Answer:
Verified
Q125: Since 1982, the Federal Reserve has:
A) pursued
Q126: According to rational expectations, monetary policy is:
A)
Q127: Proponents of the theory of rational expectations
Q128: The theory of rational expectations states that:
A)
Q129: Which statement is FALSE?
A) Early Keynesianism downplayed
Q131: A hypothesis that individuals base their expectations
Q132: The theory of rational expectations is consistent
Q133: Under rational expectations, government policy can be
Q134: According to the theory of rational expectations,
Q135: The set of ideas known as the
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