Assume the central bank increases the quantity of money by 25%, even though the economy is initially
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Assume the central bank increases the quantity of money by 25%, even though the economy is initially in both short-run and long-run macroeconomic equilibrium.
Describe the effects, in the short run and in the long run (giving numbers where possible), on the following.
a. Aggregate output
b. Aggregate price level
c. Interest rate
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ANSWER When the central bank increases the quantity of money by 25 a Aggregate Output In the short r...View the full answer
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Saud Ur Rehman
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