Pablo believed that short-run changes in aggregate demand affected aggregate output as well as the price level. He believed that there was a role for monetary policy in managing the economy, but he advocated a simple monetary rule that would increase the money supply at a constant rate to grow the economy. Pablo was BEST described as a:
A) Keynesian.
B) new classical economist.
C) supply-sider.
D) monetarist.

Question

Quizplus · Accepted Answer

Pablo's belief that short-run changes in aggregate demand affect aggregate output and price level aligns with monetarist theory. Additionally, his belief in using a simple monetary rule to manage the economy is a cornerstone of monetarist theory.

Pablo Believed That Short-Run Changes in Aggregate Demand Affected Aggregate